Sadly closed my Monzo account down recently after applying for a joint account with my partner and being denied with no explanation (both long term users, good credit etc). Apparently a common story. Opened a Starling account and got one straight away. It's a shame because the Monzo user interface is miles better.
How we got customers to sign up to Monzo in the early years
11–20 of 120 posts
Re: How we got customers to sign up to Monzo in the early years
#12Earlier quoted context omitted.
Starling makes money from business accounts (they pocket the interest on those, and that interest amounts to more considering business accounts keep a larger balance) and I believe also provides services to other payment companies, essentially SaaS-ing their tech. It's a shame because this is something that Monzo could've done just as well and there's absolutely a place (well, was - that's now taken by Starling) in t…
Monzo do have good tech, but I've also heard that there is a "surprising amount of legacy tech" there as well. I'd interpret that as either they do too many re-writes of things, and/or they're perhaps not building at the level of quality that they should have been. They have some excellent engineers in the early team, but I've also seen a lot of very inexperienced people go there, so that in combination with a "move…
I've noticed that about Monzo. They were very early adopters of Kubernetes amongst other things, which surprised me as early Kubernetes was not exactly secure...
Having seen some presentations about their tech. stack, it seems very clever and has interesting ideas, but I was worried that once the people who designed it had moved on , how maintainable would it be (coming from a banking background where I found that systems lived on for EVAR)
Re: How we got customers to sign up to Monzo in the early years
#13Sadly closed my Monzo account down recently after applying for a joint account with my partner and being denied with no explanation (both long term users, good credit etc). Apparently a common story. Opened a Starling account and got one straight away. It's a shame because the Monzo user interface is miles better.
I have this same issue - really weird - I have a joint account already with someone on my Starling and can't start a second one, anyone know another alternative I could use for a joint account?
Re: How we got customers to sign up to Monzo in the early years
#14How do they make money?
The short answer is that they don't really. UK retail banking is notoriously low margin, and all of the major banks struggle to make anything from their consumer businesses. Charging for bank accounts is not something the UK market accepts. They'll likely cover costs in the long term, and their business banking will probably do fine, but I suspect the valuations aren't justified. The main way that the major players m…
I find it hard to believe that they struggle to make money off bank accounts. It's an intentional top of funnel strategy to offer free accounts.
Re: How we got customers to sign up to Monzo in the early years
#15Earlier quoted context omitted.
Starling makes money from business accounts (they pocket the interest on those, and that interest amounts to more considering business accounts keep a larger balance) and I believe also provides services to other payment companies, essentially SaaS-ing their tech. It's a shame because this is something that Monzo could've done just as well and there's absolutely a place (well, was - that's now taken by Starling) in t…
Monzo do have good tech, but I've also heard that there is a "surprising amount of legacy tech" there as well. I'd interpret that as either they do too many re-writes of things, and/or they're perhaps not building at the level of quality that they should have been. They have some excellent engineers in the early team, but I've also seen a lot of very inexperienced people go there, so that in combination with a "move…
Monzo seems to have gone all-in on microservices (they have thousands apparently), which sounds like an absolute nightmare.
Re: How we got customers to sign up to Monzo in the early years
#16How do they make money?
The short answer is that they don't really. UK retail banking is notoriously low margin, and all of the major banks struggle to make anything from their consumer businesses. Charging for bank accounts is not something the UK market accepts. They'll likely cover costs in the long term, and their business banking will probably do fine, but I suspect the valuations aren't justified. The main way that the major players m…
Do they lend? That’s where basically all of a bank’s profits come from, deposits are just there mostly as low-cost liquidity (and because creating deposits and the flows of inter-bank transfers are all part of enabling lending to happen).
So I’m always surprised that lending and credit isn’t the core strategy of these banks - there’s very little money to be made in fees…
Re: How we got customers to sign up to Monzo in the early years
#17Sadly closed my Monzo account down recently after applying for a joint account with my partner and being denied with no explanation (both long term users, good credit etc). Apparently a common story. Opened a Starling account and got one straight away. It's a shame because the Monzo user interface is miles better.
This mirrors my experience a couple of weeks back. Having come across many others with the same problem I almost wondered if it was a case of pretend to have a feature to gauge interest (I'm sure it wasn't - I hate those things!)
I also ended up using starling instead - perfect really.
While I like the Monzo travel bits when travelling I find bank accounts much of a muchness really for my basic needs so don't have any real loyalty.
Re: How we got customers to sign up to Monzo in the early years
#18Earlier quoted context omitted.
The short answer is that they don't really. UK retail banking is notoriously low margin, and all of the major banks struggle to make anything from their consumer businesses. Charging for bank accounts is not something the UK market accepts. They'll likely cover costs in the long term, and their business banking will probably do fine, but I suspect the valuations aren't justified. The main way that the major players m…
Do they lend? That’s where basically all of a bank’s profits come from, deposits are just there mostly as low-cost liquidity (and because creating deposits and the flows of inter-bank transfers are all part of enabling lending to happen). So I’m always surprised that lending and credit isn’t the core strategy of these banks - there’s very little money to be made in fees…
They are very conservative with their lending. They do lend, but not much (relatively speaking), and in any case I'm not sure lending alone will satisfy their investor's expectations.
Re: How we got customers to sign up to Monzo in the early years
#19Earlier quoted context omitted.
Monzo do have good tech, but I've also heard that there is a "surprising amount of legacy tech" there as well. I'd interpret that as either they do too many re-writes of things, and/or they're perhaps not building at the level of quality that they should have been. They have some excellent engineers in the early team, but I've also seen a lot of very inexperienced people go there, so that in combination with a "move…
Monzo seems to have gone all-in on microservices (they have thousands apparently), which sounds like an absolute nightmare.
Yes that is one of my concerns with their tech stack. The management overhead of that must be insane.
Re: How we got customers to sign up to Monzo in the early years
#20Earlier quoted context omitted.
The short answer is that they don't really. UK retail banking is notoriously low margin, and all of the major banks struggle to make anything from their consumer businesses. Charging for bank accounts is not something the UK market accepts. They'll likely cover costs in the long term, and their business banking will probably do fine, but I suspect the valuations aren't justified. The main way that the major players m…
I find it hard to believe that they struggle to make money off bank accounts. It's an intentional top of funnel strategy to offer free accounts.
> I find it hard to believe that they struggle to make money off bank accounts.
Why is that? Current accounts are a loss-leader for most (all?) legacy banks too, they're used to lure the customer in so they can then pitch revenue-generating products such as credit cards or mortgages.