What is Monzo Plus?
The digital bank, Monzo is re-launching a paid-for premium account, Monzo Plus. Monzo previously launched a premium account in 2019, which was withdrawn in the same year. The 2019 version focused on offers like travel insurance and product discounts, but after poor customer feedback and uptake, Monzo ended up refunding customers their subscription fees with interest.
Now, it’s refocusing its premium offer with a range of new benefits much more focused on providing data insights and offering competitive interest on balances.
Key features of Monzo Plus
The Plus account costs £5 a month and for that you get 1% AER interest and the ability to add other bank accounts and credit cards to your Monzo account. Monzo Plus also enables members to move money between accounts, see and track their credit score, and access fee free withdrawals when abroad, up to £400 every 30 days. You also get a ‘holographic’ Monzo card, if that sort of thing floats your boat.
The key feature is its ability to add other accounts. This allows members to see all their transactions and balances in one place. This is certainly useful and should help customers better understand where their money is going. But as any Money Dashboard user knows, this capability is not unique to Monzo.
With Monzo Plus you will also get 15% off Patch plant and plant pot orders over £50, 25% off a Fiit home workout membership and 20% off an annual subscription to Babylon Health.
Is Monzo Plus worth the fee?
The standard (free) Monzo bank account already offers great features, so is it worth paying the extra £5 monthly (or £60 annual) fee for the extra services?
The interest rate is certainly competitive. The 1% matches (or slightly beats) most of the top paying easy access savings accounts available right now. But one thing to consider is that it only applies to a maximum of £2,000 (paid monthly), so given that it is going to earn you around £20 a year (assuming you have at least £2,000 in your Monzo Plus account all year round, then you need to find £40 of value from the rest of its services.
If you actually want to hold savings of more than £2,000 then you are probably better off putting it all in one savings account for simple convenience – the top rates of interest are currently just below 1% anyway.
Should you subscribe to Monzo Plus?
If you are considering a Monzo Plus account, take a good look at the other features of the Monzo Plus account and decide how much you are likely to use them to justify the extra cost of the fee. For example, if you travel a lot, then the fee free withdrawals up to £400 every 30 days could be attractive.
If you already have a free Monzo account or something similar, like a Starling account, then you are already getting some great features of one of the leading challenger banks. For example, both have the ability to set up ‘spaces’ within your account, round up your spending and set aside the rounded up amount for into a special ‘pot’, or set up a business or joint account from your couch. With all digital challenger banks, you get in-app analysis of your account spending for free.
Monzo Plus may work best for those who want to save around £2,000, travel abroad a lot, and who like the particular corporate discounts on offer. But to get enough value to justify the fee, you are probably going to need to use all of these things and are largely paying for the convenience of having them all in one place.
Customers don’t need to pay to get many of the core services that Monzo Plus offers. For example apps like Money Dashboard provides the ability to look across all of your credit cards and accounts in one place, for free.