Loan Offer Dramatically Reduced

Morning all,

Until a couple of days ago the maximum loan amount I was eligible for was 15,000 (5 years) but yesterday when I checked the maximum I’m now offered is 5,500

Nothing about my financial circumstances has changed - still in same job, not furloughed or anything, no spending (not left the house in two weeks!), can’t think of anything that could’ve so drastically affected my scoring.

Are Monzo scaling back loan offers? If not, something very odd has happened. Anyone seen similar and know any details?


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There has been some discussion here: Loans

A few people have reported the same, some haven’t. The loan offerings are continually re-evaluated on a monthly basis etc. It could be that Monzo have increased the threshold required to lend to people to reduce their risk.

I wouldn’t take it personally, as Monzo do have to reduce their risk exposure especially given the current climate.


Thank Michael I will have a read.

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Essentially, banks have to hold a percentage of collateral for any lending they do, to reduce the risk of customer defaults leading to bank collapse. During the banking crisis in 2008, the majority of banks reduced their customers’ unused overdraft facility as well, so they’d have more available funds to lend, and a bigger cushion to protect against what they saw as a likely surge in defaults.

I therefore don’t find Monzo’s move here surprising.


Yeah, sure, I understand Justin. I think it was the level of reduction that was alarming.

It does look alarming. However, for context, in 2008, my (admittedly unused) overdraft facility went from 10k to £1,500, so you’re doing pretty well in comparison!

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This isn’t a new issue at all. I’ve probably made close to 50 posts on various threads tracking how inconsistent it is.

Loans have been all over the place since day 1, it’s slightly improved but not by much.

I’ve had the same financial status, same report and score for years. A slightly decreasing mortgage debt and an increase in time at my address are the only changing factors.

Sometimes I get an offer, sometimes I dont, it even changes during the month even based off one report from the previous month, it’s basically based on which way the wind is blowing.

or maybe just how much Monzo feel comfortable lending from their limited pot , if you don’t take up the offer we will change it / reduce it / withdraw it and offer it to someone that does ??? maybe :slight_smile:

1 Like might have an impact, FCA is expecting 3 month freezes on loans a fee free overdraft up to £500 for 3 month, I would certainly be looking not to grant new credit just now

edoi it might be that Monzo already offer this on a case by case basis, but the fact that its in news and coming from the FCA will likey mean more ask for it and expect it

Mine went from 15000 to 0 in one step. Caught me out actually as I needed some money quickly one day… luckily my credit card limits took care of it.

It’s to be expected given the circumstances.

I’ve never been offered a loan by Monzo but up until recently, was preapproved for a 2.9% loan through Zopa. When I logged in today, despite my so called “borrowing power” remaining at 10/10 the rate offered is 7.9%.

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Hi guys I’m new with Monzo
I would like to know how do I apply sir a loan
Can any lane help?

On iOS scroll to the right where your card and pots are, you’ll hit ‘things you can do with Monzo’ loans is listed there

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Just thought I’d update this as the last couple of days have been ‘hilarious’

Two days ago I happened to check the loan section of the app (just because the app was updated and I wanted to see what had changed). Somehow my maximum loan amount had shot up to £13500!!

Logged in today to show my disbelieving wife and I get the message “Sorry we cannot offer you a loan.”

WTF? :rofl:

Now the loan itself is not a real issue but I was planning later this year to close my ‘regular’ Natwest current account and start using Monzo as my main account. I could be overreacting but this kind of thing (the rollercoaster of loan offers) has me a bit twitchy. I know, Monzo are taking precautions in the current climate but :man_shrugging:t2:


I don’t know many other banks that make it so clear in their apps what loan you can get. I bet if you asked a different bank at the same intervals if they’ll lend to you, you might get the similar response.

The transparency here from Monzo, in some cases, seems to be annoying people, instead of the inverse.


It’s transparent only so far as you can press a button at any time on the app and spin the wheels of the Loan Fruit Machine.

Like I said, the loan isn’t primarily the issue. It’s the fact that Monzo’s ability and/or willingness to offer financial products ebbs and flows in quite an alarming way. It was the fact that the offer skyrocketed to 13.5K and then completely disappeared in two days. Say I needed a loan and was trying to do some financial planning - “Well at least I can get a loan from Monzo if I nee-… oh hang on!”



Im really annoyed , I put in 100K into earnings , homeowner with no mortgage , and I didn’t get a loan offer ,my credit score is crap though because I dont use credit so have no history , I didnt need it anyway , but quite annoyed about it , maybe Monzo think I don’t need the loan …:slight_smile: but it would have been nice to have the facility , just in case


Could be, or could be your perceived scenario has changed. Might not be them changing their boundaries, but you slipping from one category into another.

Who knows, no one does.

But if you’re not worried about the loan, why does it bother you? Surely you should be happy that a bank is being more cautious with its lending given the current scenario.

Unless, speculating of course, some people are simply using the amount Monzo will offer them for gloating? But that’d be a silly assumption.

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I think it might be more the fact that the offers go up and down so rapidly which would indicate that Monzo has very little available funds to lend which causes the concern. I don’t think the concern is ‘I can’t get a loan’ per se.

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I doubt it’s that closely tied to how many funds they have, but could be wrong. It could just be they’ve reduced the % of funds they want to lend out, and it’s taking time to impact on people.

Also, as it’s only when people check, I’d imagine it’s not fluctuating as much as people really think ie, if you check just before & just after a change, but then that change lasts a month you’re seeing it quickly change, vs checking at the start & end of the changes giving you 2 months.