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Monzo to add some fees for less active users amid cost cutting drive and premium push

The digital bank, like many fintech challengers, is playing closer attention to costs. This follows a down round earlier this year that saw its valuation fall 40 per cent lower and a series of redundancies.

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Monzo is adding new fees for less active users in November, about one in five of its more than four million customers. 

The new changes will, Monzo says, only affect a small minority of users. Particularly those that use it ‘more as a spending account than a bank’.  

Some customers will, after 31 October, have a fee-free ATM allowance of £250 every 30 days in the UK and EEA, with a 3 per cent fee after. 

Allowances outside the EEA aren’t changing for anyone, staying at £200 every 30 days, with a 3 per cent fee after. 

Also, in November Monzo will start charging for replacement cards. Some users will get two free cards and after that pay a £5 fee. Other customers will always pay £5 in the UK, and won’t get two free ones. 

Those getting bigger allowances will do so because Monzo deems them to be using it more as a bank than a spending account. 

“This doesn’t necessarily mean we’re your only bank, but it does mean you’re likely to use Monzo enough to depend on us for some of your core banking needs,” Monzo said in a message to customers. 

This is because customers are doing at least one of the following. 

  • Paying at least £500 in total into a Monzo account every 35 days, with at least one active Direct Debit on the same account in the same period.

  • Getting a Department for Work and Pensions or Department for Communities' payment (things like Universal Credit or a state pension) in the last 35 days.

  • Getting your student loan paid into a Monzo account every 8 months. 

  • Sharing a Monzo Joint Account with someone who does one of the above. 

Monzo Plus customers also get the bigger allowances. 

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