Everything you need to know about Monzo Bank
With 7.5 million customers and counting Monzo’s popularity has swept across the UK as customers flock to get their hands on its hot-coral card.
The digital bank led the way with a variety of features to help customers manage their money from the comfort of their phones.
From spending insights and overdrafts to opening a savings pot, you can handle most aspects of your finances from the Monzo app.
This review focuses on Monzo’s standard free-to-use current account rather than the paid-for options.
Find out how Monzo works and whether it’s worth getting an account.
What is Monzo?
Monzo is a digital bank that is operated entirely through a smartphone app.
Starting its days as a prepaid card back in 2016, Monzo is now a fully-fledged bank with millions of customers across the UK.
Today Monzo has upgraded its features, offering several types of current accounts (and other services like borrowing and savings products) to help you manage your money.
Types of Monzo Account
Monzo currently offers the following types of current accounts:
- Monzo Standard
- Monzo Plus (read our review)
- Monzo Premium (read our review)
- Monzo 16-17
- Monzo Joint Accounts
- Monzo Business
Monzo’s standard current account offers a variety of features that can help you manage your finances.
Many of these were first seen on Monzo, though some have since become common across a number of other challenger and high-street banking apps.
We’ve broken down the features into the following categories – spending, budgeting, saving and borrowing.
Spending with Monzo
- Mastercard debit card: Monzo’s hot-coral debit card is Mastercard which is accepted by most merchants around the world.
- Customisable contactless limits: You can decide if you want a lower cap for contactless spending, set by default at £100 for single taps and £200 cumulative before you need to enter the PIN
- Apple/Google Pay: You can add your Monzo card to an Apple or Google Pay wallet to make contactless payments from your phone or a compatible device (like a smartwatch).
- Instant updates: You can enable instant updates each time you spend which can help you track your payments quickly.
- Committed spending: This feature lists all of your regular outgoings each month including bills and subscriptions.
- Transaction tags: You can add tags and additional notes to your transactions to help sort your payments, though you’re limited to set categories with the free version of Monzo. If you really want to get into the nitty gritty then you might be better off with a third-party budgeting app
- Spending abroad: Monzo offers fee-free spending abroad and up to £250 free cash withdrawals per month for EEA countries or £200 for non-EEA countries (after that a 3% fee applies).
- Cash withdrawals: Unlike most other banks, there’s a cap here. You can withdraw up to £250 every 30 days in the UK (after that a 3% fee applies).
- Splitting the bill: Split bills and payments with other Monzo users easily in the app.
- Monzo Me: Request money from someone using a unique link generated in the app. (You can also use this feature to pay people too!)
- Gambling block: You can block transactions to gambling websites and services through the app.
- Card details: Monzo allows you to check your PIN and debit card details (like the debit card number and CVC) in the app.
- Account sharing: You can easily share your account no. and sort code via messenger, email and other apps.
- Card freezing: If you think you’ve lost your card, you can freeze it in the app to stop payments from going through until you find it.
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Budgeting with Monzo
Monzo Trends gives you an overview of your finances in the app, both on the home screen and in a separate tab. There are several features in this tab:
- Balances: You can view your individual and combined balances across your different Monzo accounts and any Pots you’ve set up.
- Spending: You can also track your spending and see how much you’ve paid for different categories of expenses. For example, it’ll show how much you’ve spent on things like transport, entertainment or groceries to name a few. It also lets you compare your spending insights month on month to highlight any changes.
- Target: Monzo Trends also lets you set targets for your spending each month which you can break down into specific categories as well.
- Left to Spend: Over the course of the month you can check how much you have left to spend of your overall budget (and for each category if you’ve set specific targets for those).
These aren’t the only budgeting options, you can also manage your money with:
- Salary sorter: This feature splits your salary across different pots, such as money for spending, bills and savings. (It also works for splitting any deposit over £100 into your account.)
- Early payday: If your salary is paid into Monzo they’ll pay the money into your account at 4 pm the day before.
- Monzo Pots: Create up to 20 Pots for different expenses e.g. bills, food, and nights out. (It’s very similar to the “jam jar” or envelope budgeting method).
More on Monzo Pots
- These can be customised with pictures and bespoke titles.
- These do not have their own sort codes and account numbers so you’ll mostly need to manually transfer cash into them, however, you can set Direct Debits to come out of specific pots – handy for allocating cash each month for things like bills.
Saving with Monzo
- Round ups: Monzo’s auto-savings feature allows you to round up your payments on the card to the nearest pound and it puts the extra money into a pot for you. (This can build up to a nice chunk of change over time!)
- Savings pots: You can use the Monzo Pots to separate your cash from your main account, making it harder for you to use it for everyday spending. money. However, to earn interest on this money you’ll need to open a specific savings pot. Remember to check if the rates can be beaten by other easy-access savings accounts on the market right now.
- Automated savings: You can connect to a service called IFTTT (If This Then That) to trigger auto savings. This can be anything from the 1p savings challenge through to moving money when an event happens such as rain. It’s a unique feature which might make it easier to add to your savings without any effort.
- Overdrafts: You might be eligible for an arranged overdraft. Depending on your credit score you’ll be charged 19%, 29% or 39% to use it. Though these lower rates are cheaper than most other banks, it’s still an expensive way to borrow.
- Mortgage tracker: You can connect your mortgage to the Monzo app and track your payment progress, explore overpayments and get more insights. Though how useful this will be is questionable.
- Loans: Monzo offers loans of up to £25,000 for eligible account holders.
- Monzo Flex: This is effectively BNPL.You can split the cost of your purchases into instalments of 3, 6 or 12 months using Monzo Flex (here’s our analysis).
Using the Monzo App
It’s not just the features listed that made Monzo so popular – it’s also how easy the app is to use. Or at least that was the case. It’s been through a few iterations, with our Editor-in-chief Andy not a fan of the most recent iteration.
However, as of summer 2023, there’s a whole new look for the Monzo App (if it’s not been rolled out to you yet you can activate it via Monzo Labs in settings.
This is largely an update to its home screen design. A big part of this is customisation, so you can choose what you see and where. Straight away it makes it a lot easier to see your main Monzo account, and access key features such as your card and get statements,
Above this you’ll see selected insights into your spending, while Pots can also be reordered and customised, giving you the choice between the classic look (with pictures) or a list.
You still have the Trends, Payments and Help tabs at the bottom of the screen to quickly jump between these sections. You’ll find more settings by hitting your initials (or a photo if you’ve set this up) in the top left corner.
It’s early days but it looks like this update is a big improvement and makes Monzo once again one of the easier apps to navigate.
How to add money to Monzo
It’s easy to make digital transactions to add money, but it’s a lot harder when it comes to cash and cheques are there are no branches.
Here are the main options to add money to your Monzo account:
Make a bank transfer
You or another person can transfer money into your Monzo account using your sort code and account number.
Bank transfers typically land in your account instantly, but sometimes it can take a little longer for the transaction to go through.
Money can be added to your account using the Monzo Me feature. It allows you to create unique QR codes or payment links to request money from others. You’ll find this in the Payments section by hitting the four boxes icon in the top right corner of the screen.
You don’t have to be a Monzo account holder to make a payment using this link. Which makes it really useful for requesting money from people who bank elsewhere.
Unlike Starling and many other banks you can’t use Post Offices to pay in cash. Instead, you can deposit cash into your Monzo account using PayPoint, which you’ll find in all sorts of shops, including some Asdas and Co-ops. There are around 28,000 locations across the UK (keep an eye out for the yellow logo in shops or search here.
Sadly PayPoint isn’t free. It costs £1 to make a deposit and you can deposit £5-£300 in one go. There’s a £1,000 deposit cap every six months too. (For the 16-17 account this limit drops to £500 every six months).
Usually, it takes about 10 minutes for the money to show up in your account.
Monzo allows you to deposit money into your account using a cheque. To do this you’ll need to tap the home icon in the menu bar, select “add money” and then tap “cheques”.
It’s worth noting that this is a pretty lengthy process. It takes around 5-7 working days for the cheque to get to Monzo HQ. And then another week for it to be processed.
So it may be better to make cash deposits into an account that has a quicker turnaround if you deal with them regularly.
Another thing to bear in mind is that Monzo only accepts cheques in GBP. Other currencies won’t be accepted.
You’re better off having an account at a different bank that lets you pay in cheques via their app and transfer the money over.
Monzo fees and allowances
Although Monzo’s standard account is free to use, the following fees may kick in for certain payments or services:
- Cash withdrawals in the UK: Monzo charges 3% on cash withdrawals over £250 in a 30-day period in the UK.
- Cash withdrawals abroad: A 3% charge applies to withdrawals over £250 in EEA countries and £200 in countries outside of the EEA.
- Cash deposits: You’ll have to pay £1 per cash deposit into your Monzo account (which can be done via PayPoint) up to £300 per day. And up to £1,000 every 6 months.
- Card replacements: Monzo charges £5 for card replacements unless you meet the criteria for 2 free cards per year, your card expires, is stolen or you’re the victim of fraud.
Monzo customer service
Monzo is a completely digital bank and doesn’t have any physical branches for you to visit. So, most of the customer service is managed within the app.
You can get in touch with them 24/7 with urgent queries by tapping the “help” tab and starting a chat (at least you should be able to – check out the next box if it doesn’t appear for you).
Why isn’t the chat function showing in Monzo?
Though some Monzo customers will be able to easily click to chat to Monzo, some users won’t find this option (including our Editor Andy). Luckily we’ve uncovered a workaround.
On the Help tab, type Contact Us in the search box, and it’ll pull up a page where you can open up a chat via a link called “Tap here to get started”.
You’ll see some preset options, and even if these don’t relate to your query you can keep answering questions until you’re shown the option of “ I need to chat with someone”
Monzo also offers customer support via call between 7am and 8pm. You can call for free on 0800 802 1281 if you’re in the UK or +44 20 3872 0620 if you’re calling from abroad.
There are some things Monzo can’t help with over the phone though. This includes sharing account information and updating your mobile number or email address registered to your account. (You can update these in the settings on your app).
Is Monzo safe?
Monzo is a fully-fledged bank and is regulated by the Financial Conduct Authority (FCA). That means that it’s legally required to treat customers fairly and protect their funds.
The money held in your Monzo account – up to £85,000 – is protected by something called the Financial Compensation Scheme (FSCS).
This basically means that if something goes wrong with the digital bank, you’ll be able to get up to £85,000 money back.
However, if you add money to some linked savings accounts (though not all) are actually held with other banks. It’ll be clear who this is (if it’s not Monzo) when you open that savings pot.
What is the FSCS scheme?
FSCS protects up to £85,000 of your money held in banks regulated by the FCA. It’s important to note that the protection applies to a banking licence and multiple banks can be held under each one licence. So, let’s say you have three current accounts with different banks under the same licence. That means the £85,000 coverage would be split across all three, rather than applying to each account. Here’s more.
Will Monzo close my account?
There are often reports of Monzo closing or freezing bank accounts – there’s even a Facebook group devoted to impacted customers. And they’re not the only bank to come under fire for this, NatWest, Barclays, Monese and Revolut have also hit headlines for bank account closures too.
Ultimately, as with all banks, Monzo has the power to freeze, block or close your account to protect other customers.
Some of the reasons why they might close your account include:
- Unusual activity: If they suspect your account is being used for criminal activity it may be blocked or closed. (This includes if their fraud systems pick up that someone else might have access to your account to protect your money from being stolen.)
- Risky customers: Any account holders that are flagged as a risk to Monzo or other customers may have their accounts closed.
- Police instruction: Monzo will close your account if they’re asked to by the police as part of a financial crime investigation.
But we don’t think it should be something to unnecessarily worry about over other banks. Monzo argues they might appear to close more accounts, but that’s because their technology means they’re better equipped to spot dodgy behaviour.
However they won’t always get this right, so if you are affected, then contact the Financial Ombudsman.
Monzo customer reviews
Smart Money People rate Monzo 4.93 out of 5 stars at the time of writing (August 2023). And that’s based on 11,422 customer reviews.
Positive reviews of Monzo’s standard current account highlighted the ease of use, app features and savings pots.
Negative reviews of Monzo’s standard current account had issues contacting customer service and getting their queries resolved.
Monzo Pros and Cons
The table below summarises the pros and cons to consider before opening a Monzo current account.
- Simple to set up and use
- Lots of budgeting features and some spending insights
- Fee-free spending abroad
- Automated savings including round ups and your own scheduled savings pots
- Ability to combine with IFTTT to boost savings
- Potentially lower cost overdrafts
- FCA-regulated and FSCS protection
- No credit checks unless you apply for an overdraft
- 3% charges on cash withdrawals over the free allowance in the UK and abroad
- No bank branches or face-to-face customer support
- £1 fee for each cash deposit you make (and you can only deposit £1,000 every 6 months)
- Doesn’t offer interest, cashback or rewards.
- You have to pay for full functionality
- No virtual cards on the free account
- No bank switching offers
Is Monzo any good?
Beyond the fandom, Monzo’s standard current account is a decent all-rounder for spending and budgeting.
The redesign is a return to a more intuitive experience, and it still offers lots of features that help you get to grips with managing your money, setting budgets and saving too.
Little things like being able to view your debit card number or PIN make paying so much simpler as well (though of course, many others offer this too).
Overall, if you’re looking for an easy way to budget and manage your everyday spending, it’s worth giving Monzo a look – as long as you’re comfortable with a fully digital banking experience.
However, we think there are better options, which we’ve listed in our alternatives to Monzo section below.
Alternatives to Monzo
For an everyday banking experience Starling still has the edge in our opinion. Plus there are no limits on cash withdrawals and the ability to use the Post Office for cash. LINK
Chase is also very easy to use but comes with the added bonus of 1% cashback at home and abroad. LINK
Or you could look at a reward based account from more established banks that have much-improved apps as well as access to high street branches (as long as they’ve not been shut down). Freebies include free Disney+ from Club Lloyds or £5 a month from Halifax Rewards.
And, when it comes to saving though you’re probably better off automating the money you’d like to set aside to go to an account with another provider. As you’ll be able to take advantage of the best savings rates out there.
How to apply for a Monzo account
You can apply for a Monzo account for free using the following five steps:
- Download the app: Click this link or simply search ‘Monzo’ in the App Store or Google Play, then hit download. It’s worth seeing if any friends already use Monzo as you might be able to get a £5 referral link to use when joining.
- Personal details: You’ll fill in the first section of the application with personal details such as your name, home address, employment status and phone number.
- ID checks: Monzo will then verify your ID by asking you to snap a picture of your ID. You can use your passport, driving licence, national ID card or biometric residency permit. Then record a selfie video.
- Choose your account: Once your ID is confirmed you can choose your Monzo account and card.
- Activate your card: You’ll need to activate your card in the Monzo app to start using it. (It usually takes a couple of days for it to arrive at your home address).
Does Monzo offer Student Bank accounts?
Currently, Monzo doesn’t offer bank accounts for students specifically. If you are a student aged 18 or over, you can still use Monzo to manage your spending while also having a designated student bank account with another provider.
Younger students aged 16-17 can apply for a Monzo account as well. The Monzo 16-17 account works in the same way as the standard one. The only difference is that there are spending blocks built into the account for age-restricted things like gambling.
Can I use Monzo abroad?
Monzo offers fee-free spending when you go abroad. It used to be one of the biggest selling points of the account, but there were restrictions added a few years ago that you need to be aware of.
With a Monzo standard account, you can withdraw up to £250 in cash while travelling in EEA countries every 30 days. This falls to £200 if you’re taking out cash in countries outside of the EEA.
Now, the cash withdrawal cap may be on the low side depending on how you travel and other providers offer more.
For instance, Starling Bank offers unlimited spending and cash withdrawals abroad on their free standard account. And Chase isn’t just fee-free for spending but you’ll also earn 1% cashback. Check out our roundup of the best debit and credit cards to use abroad for more.
What happens if I lose my phone?
If your phone is lost or stolen, you can freeze your account to prevent any payments or transactions from being made on your account.
You’ll just need to log into Monzo’s emergency webpage to activate the freeze. It’s a really basic version of Monzo that only allows you to see your accounts, check your balance, view recent payments from the last 90 days and freeze or unfreeze your card.
Does Monzo offer switching deals?
Monzo doesn’t offer any switching deals currently, though you can still switch as you would to any other bank using the Current Account Switch Service (CASS).
Check out our round-up of the best bank switching deals to find out which providers are offering top-paying bonuses, cashback and rewards if you switch to them.