Changes to charges *disincentivise* using Monzo as a main bank for freelancers

I got the message (like I assume most people) about the changes to fees. Monzo says the new fees are to encourage people to use Monzo ‘more like a bank’. Thing is, for a freelancer like me, it does the exact opposite. I don’t get paid regularly, but when I invoice, which isn’t always more frequent than every 35 days throughout the year. If I were to use Monzo as my main bank, and get invoices paid into there, I’d lose the perks of ‘using it like a bank’. If, instead, I get invoices paid into another bank, and regularly move £500+ per month into my Monzo account, I keep those privileges.

I’m not saying Monzo doesn’t need to make money, or even complaining about the allowances per se, but it does seem to me to achieve the exact opposite what they want - people using Monzo as their main bank!


Unless you take out a lot of cash, the fees don’t really change anything anyway.

If you’ve never lost more than 1 card and you don’t take out £250+ a month, nothing changes.


It sounds like

(a) You’re an edge case,
(b) You’ve found a way around it

It’s impossible for a bank to take a ‘one size fits all’ measure with their entire customer base. You seem to be OK in that you call outside the measure but you can still find a way of making the terms work.

As for customers who fall outside the measures and can’t make the terms work, Monzo are mostly OK by that too, as they’ve judged that losing those customers has no negative effect on them, and perhaps even a positive effect. I say mostly, because where customers are indeed using Monzo as their main bank account but for whatever reason can’t meet the conditions, Monzo have said that they should chat to them in app and see if anything can be done (for example, students whose stipends are quarterly, or non-working people who are having to live off limited savings until they get a new job).


I suspect his is probably only a problem for a small minority of customers, ie freelancers working on longer term projects, and/or with a smaller number of clients. As @Revels has said, its also a pretty minimal impact unless you a serial card misplacer who works mostly in cash because you know how bad you are at misplacing cards :slight_smile:.

Monzo will have known exactly what %age of their customers would be affected by this well before they announced it, I don’t see it changing. Presumably this worked better than saying average £x/year - which I might have helped in your situation, but I imagine it would be impossible to find a fixed amount that was fair - ie didn’t exclude lower earners, but did exclude bigger spenders who fit into the ‘using Monzo as a spending card’.

Presumably its trivially worked around by bouncing some of your own money into/back out of an external account, anyway?


So - I doubt that very small numbers of freelancers are in my position. Most I know either invoice ‘as and when’, if working on longer term projects, or set aside an afternoon to do their invoices, which might well be once a month, but they’d be annoyed to have an external figure (especially their bank!) enforcing this.

And you’re absolutely right I can get around it. The point is, the way anyone can get around this is… to have a different bank account.

Call me crazy, but I don’t think rules which encourage people to use a different bank account are a great way of incentivising people to use Monzo for all their banking needs, which is precisely the thing they claim to be trying to achieve with this rule!


You’re right - it probably doesn’t adversely affect me (or many others). But the point I’m making is that as an incentive to use Monzo as your main account it does precisely the opposite!

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I’m a freelancer too.

I have a Monzo business account and pay myself a “salary” each month. This would also be a way solve your issue (that doesn’t seem to be an issue).

Saves you having to sit on a huge amount of cash to cover all your bills over those long periods, so you can budget and stuff too :slight_smile:


Again: I’m not saying this is an issue.

It isn’t an issue for me at all, because I can avoid the charges by having another bank account. No problem!

But that’s the opposite of what Monzo want from it. They state that these charges are to encourage people to ‘use their account more like a bank’. In fact, they encourage behaviour - like you’re suggesting - that’s more like the ‘spending card’ they want to get away from.

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That’s your way of looking at it.

You don’t need another bank to avoid these charges and if you do take out a lot of cash, then Monzo probably isn’t the bank for you.

But some people will have moved a direct debit/salary over and now use Monzo full time.

“That’s your way of looking at it.” - um, not sure what’s with the passive-aggressive defensiveness!

Incentives aren’t a matter of perspective. They either do or don’t incentivise some behaviour.

In this case yes they are.

You don’t like the fees and are going to have another bank/move around to avoid it despite it having zero impact on you and others have moved over to Monzo fully to avoid the fees.

Erm. Again: I don’t mind the fees. I even think it’s a good thing if Monzo is getting on a balanced footing. This post was never about the pros and cons of fees.

The point is: something that rewards one behaviour (having another account, regularly moving money to Monzo) can’t be claimed to be encouraging the opposite behaviour (having only one account, having all money paid into that, no matter when that is).

Compare with the direct debit requirement, which is, of course, about encouraging people to use Monzo as their main account. Having another account doesn’t help at all with this requirement, so will indeed push people to move (more) fully to Monzo.

I don’t really understand what you’re trying to get at. Of course there’s a way around it, there is with most things in life. But the majority of people will pay the fees or move over. That’s what Monzo want. (or leave completely, which they are probably not bothered about)

Yes, you can move £251 out and back in every 15 days and game the system but you aren’t ‘rewarded’ by having another account. You’re just gaming the system and if that’s what you want to do then crack on.


You can use your Monzo account and not do that.

There will obviously be some edge cases where people get paid irregularly but it’s not just freelancers and it’s also not really going to impact many people anyway.

I agree, being a freelancer is irrelevant.

By the same thread you could say that mortgage providers “disincentivise” freelancers because they ask for payments monthly. Or loan providers, or Netflix, or any other service provider - it’s just how the industry is.

The crux of the matter is that if you get paid irregularly there’s not much anyone (other than yourself) can really do about that.

I’m getting at something very simple.

a) Anyone who doesn’t get paid every 35 days or more frequently is incentivised to have another account and have their money paid into that. (Even if, as you say, the charges are so marginal it’s not /much/ of an incentive.)

b) Nobody who is paid with any frequency is incentivised to have their money paid directly into their Monzo account by this rule. (Rather than the more reliable, have £500 transferred each month.)

Given a) and b) is is completely false to suggest that the change in assessing payments into the account (as opposed to the direct debit) encourages people to use Monzo as their main account. It doesn’t encourage anyone to do so, and it discourages some people from doing so.

Not complex at all.

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Ordog - you’re missing my point.

If Netflix wanted to get people to pay monthly rather than annually, offering a more expensive monthly fee than annual fee wouldn’t incentivise it. It would disincentivise the behaviour they say they want.

If Monzo wants people to use Monzo as their main bank, charging more to people who do (even if, as people have pointed out, it’s very marginal), can’t be construed as incentivising people to do so.

I mean you’re wrong on both your points (and your next post) so maybe it’s more complex than you think.

But this is going around in circles so I’ll leave it to you now.

What are you suggesting? That it’s removed completely or something else?

I guess I think there are better indicators that someone is using Monzo for their main banking account, and this is a particularly bad one. The direct debit requirement, on the other hand, works great.

For example, you can get Amex credit cards with great special offers and incentives. They require you to have a minimum monthly spend. Similarly with cards specifically for spending abroad, where you have to use them with a certain regularity or they expire. These are exactly the use case that Monzo is trying to shift people away from (because, quite rightly, they don’t just want people using Monzo as a way to get cheap holiday spending money, without them using the card for anything that makes revenue) - so why is Monzo using the same indicator as them to determine if you’re ‘using Monzo as your main bank’? Nobody’s Amex credit card is their main bank account AFAIK!

I’m not actually complaining per se, Monzo can run their accounts however they want. Just seems that a non-negligible number of people will be put off using Monzo as their only bank account by this, and nobody will be encouraged to.

Sorry - I didn’t really answer your question. I don’t know what the solution is. I suspect they could use a slightly more sophisticated algorithm to detect ‘main bank account usage’, by seeing whether you’re spending on a variety of different products / shops / etc. And as I say, direct debits seems a good criterion. Even ‘Deposit £10000 per year’ is likely to be a better indicator than £500 a month, if they want to see you’re not using it as a top-up / prepaid spending card!

If you spend on your Amex and pay it off every month, this information isn’t available. If it’s lockdown and you don’t use an Amex, you may not be spending at all other than for food. If you just go for Groceries as the factor, what if you get all your food from the corner shop and not from a big supermarket, so your shop is not “on the list”? It’s just too complex.

Edit: removed my 2nd point as I realised you said £1K per year, not month, oops.