Loans


#62

I’m not one to take the moral high ground, and I generally prefer the responsibility to be with the person, not the company… But… I hate this.

With people seemingly looking to “gamify” things in their life, I can see a lot of people looking to “complete” their Pot Goal by taking out a loan (at a bad APR rate).

I just don’t think it’s needed? Not for a Pot Goal surely?

This is where a short term loan can come in useful - But that implies your Pots (and associated goals) are for specific purposes where you actually NEED the money - Rather than using Pots to ring fence a rainy day fund, or simply removing the money from your main account.

But even still… I just don’t like the idea that people will end up taking a loan out to “complete” their Pot Goal quicker…

If people need the money, the loan option is there for all to see without it being an advert within your Pot.


((╯°□°)╯︵ ┻━┻) #63

I guess it depends on what the pot is for, whether it is acceptable to offer a loan to hit your goal.

If it’s for car insurance then its bad, but for something more important like surgery it’s a good thing?

Then again, how are Monzo to know :man_shrugging:


(Jack B) #64

That’s some crazy interest rate - has it been the same on all loans they offer? I just got a sainsburys loan at 2.5%


(Fin) #65

I agree with you. Monzo are in that monetisation phase where if they do it badly they forget who they are and what made them successful in the first place. I was a little wary when I saw the Octopus energy partnership – why had only Octopus been partnered with – and no mention of future plans? I took part in the Bulb marketplace beta last year, switched through Monzo (although it was fairly manual – essentially Monzo got a £25 fee) and have been really happy and impressed with Bulb ever since – they offer market leading prices, renewables etc., so why haven’t they been included also? I hope Octopus is the first of many, as opposed to just the partner that’s going to give them £50 for every sign-up – that’s not why I got excited about Monzo. It’s not the mission and message Monzo have been portraying, and they’ve been tight lipped on future plans with it – so my suspicion is it’s just Octopus for the foreseeable – which is also bad.

The danger is Monzo pick and choose criteria that suit them in order to sell a partnership (I think trustpilot score was listed for Octopus on some of the screenshots I saw – and we know how reliable those are…) – I don’t want to be cynical when I think of these things, I want Monzo to offer me the alternatives too so I can choose and make an informed choice – not think, “Monzo are only showing me Octopus because they get £50 and not the £25 Bulb pay”.

Monzo need to explain these things as currently it doesn’t sit well with me, and doesn’t represent their vision.

I’d say offering a customer the chance to take out a loan for the sole purpose of hitting a saving goal (on savings which don’t pay interest) is borderline irresponsible lending. It’s cheap and Monzo are better than that.


#66

But if someone needed a loan for surgery (to use your example), the option is already there in the app.

I’d also hazard a guess that most Pot Goals are for non crucial things (more of a “would like to have” than an absolute need).


#67

Is your Sainsbury’s loan for <= £1000? It is a high rate, but it isn’t out-the-park when compared to loans for these amounts.


(Fin) #68

I don’t think anyone is saying short term lending is a bad thing, it has many purposes and benefits and if Monzo do it properly it could be a superior service to other banks – just don’t market it to people wanting to hit savings goals as that is literally the worst thing financially for the customer. Make them aware they’re pre-approved in a different way.


((╯°□°)╯︵ ┻━┻) #69

I can think of plenty of other scenarios like saving to pay for a holiday before you go away, which are arguably important but your other point about advertising elsewhere is a good one.

I assume that it doesn’t do this on every pot and every time you create one? Does it just show once then if you dismiss it, you don’t see it again? I can probably live with that because it is then just advertising a loan essentially.


#70

No idea, I don’t use Pots so wouldn’t see it.

I have zero problem with a bank advertising their loans.

I don’t like this though, as it feels like the people who get a thrill by closing savings goals, will potentially get themselves into trouble.

It just feels a little unnecessary when there are plenty of other places in app that Monzo could inform their customers about a loan.


((╯°□°)╯︵ ┻━┻) #71

No way! They’re the best thing ever :exploding_head: :joy: :wink:

I use pots but none have goals so I wouldn’t see it either :slight_smile:


(Jordan) #72

This feels a little bit predatory for me (granted we don’t know the numbers this is going out to and to whom) but it still leaves a lump in the throat.


(Tony, Secret Lemonade Drinker) #73

It appears on only one of my Pots, and only did so today. I’d not seen it before then (and would have noticed).

The Pot in question has a goal of £1000 and is currently at £300, having been topped up by a scheduled £100 payment earlier today.

If I go to the loan section manually, I know I’ve been pre-approved for a loan of upto £750, so this combination may all work together, i.e. coming below the max loan amount I’m permitted following a scheduled payment, on a Pot with a goal amount.

I also have other Pots with lower goals and scheduled payments into it, but those are via IFTTT, hence my suspicion the scheduled payment may be involved here.


(Splodf) #74

Whoever came up with this idea needs firing. It’s exploitation.


(Jordan) #75

It does scream Wonga and HCSTC - I get the profit margin on lending - but let people find that themselves.


(Dan Mullen) #76

This is a new low IMHO. Monzo aren’t known for offering great value or fair fees but this is something else. Surely there’s some sort of regulation to stop banks from advertising in this way? Encouraging customers to take out a loan at 20.6% APR to reach a savings goal that will earn them zero interest?


(Alan) #77

This is a disgrace. There really is no other way to describe it


#78

I’ve got agree with everybody else. Savings shouldn’t be where to surface loans and it does seem slightly predatory.


#79

I absolutely agree with everyone here. By all means advertise your loans and lending. But to display it where your pots are and to suggest you can meet your goals by doing so is very shabby to be honest.


#80

Perhaps someone from Monzo can explain the context/thinking behind this decision?

When Starling started advertising loans in their app after you bought something for £500 or more, there was unanimous condemnation.

But, Starling (can’t remember if it was Megan, Anne or someone else), came on and explained why they’d done it, and what they thought the scenarios would be where it would be useful.

It didn’t change the fact that people still didn’t want to see it like that, but it did help understand the decision a bit more.


(Nathan) #81

Im a +1 for this… awful awful way to try and “sell” a loan.

Please please monzo stop throwing away the values that made you popular in order to hit a profit as soon as possible :see_no_evil: