Loans


(Alan) #142

Sitting on holiday, worrying how i’ll pay it back didnt feel like a holiday to me.


#143

I don’t see how you feel that’s ever an appropriate response?

Have a good day Alex.


((╯°□°)╯︵ ┻━┻) #144

“To you” is the key here - no two people are alike :wink: For the lifetime of memories it could create for a family, some would see it worthwhile :slight_smile:


(Jordan) #145

I have no issue with using loans to pay for things like holidays - but if you wanted a loan for these things - you’d go and get one, its quite clear how to access this through Monzo.

I don’t think it is responsible to have the prompt in the area where you are likely to be putting money away to “save-up” for those things.

Part of Monzo’s marketing is that “you’ll reach your goal quicker” I’m not sure that’s a fair way to market a loan.


(Alan) #146

That’s true. And you’re right there are a lot of things you can buy on credit. The main issue here, is they target people who are responsibly trying to save for their goal and attempt to turn them into loan customers.


((╯°□°)╯︵ ┻━┻) #147

Yep that was my point, we can finally agree! haha :smiley:

Just better placement of the ad and all is good in my opinion.


(Andy Slater) #148

Savings and borrowing ARE linked, it’s important to be able to compare your rates (if you have rates) and decide whether your money is working for you, but this is taking that the wrong way.

If you have debt, its often pointless to save, unless your savings rate is higher than your debt rate so seeing both in the same place can give you an idea whether it’s better to keep saving or to use that money to pay off debt.

This idea of borrowing to reach a goal takes that the other way, in a very irresponsible manner.

I take the point that if you’ve set a goal then it isn’t savings in the traditional sense, but setting a goal shows that you have made plans to reach that goal, aggressively selling a loan is a very bad approach.

As has been said, if you need the money soon, there’s easy access to the loans (if eligible). Aggressive lending has caused countless problems over the decades, let’s not consider it valid from a company that claim to want to help people manage their money


(Dan Mullen) #149

Except the APR… :wink:


((╯°□°)╯︵ ┻━┻) #150

lol :rofl:

Even that is fine. Again it’s all down to the individual, just like the interest on savings pots. There are better out there but it will appeal to some people :slight_smile: Thank god we have choice :wink:


(Rob) #151

As soon as I saw the offer in my saving pot I knew it would ruffle some feathers.


(Ellen M) #152

Hi all,

My name is Ellen and I work in the Lending team. Thanks to everyone who took the time to share feedback on this - we’re really grateful for your thoughts and we’re taking it on board. Just to let you know: we’ve removed this prompt and ended this experiment.

We love it when you tell us what we’re getting right, but we also need to listen when we get things wrong. We’re sorry if this test came across as irresponsible - this was not what we intended. Here’s a bit more context behind our thinking…

We ran a small experiment with around 600 customers earlier today, offering them loans above their Pots. We chose these customers because their Pots had an active goal and were titled ‘Holiday’, ‘Travel’ or other place names. The thinking there was to allow people to lock in lower flight and hotel prices (as they tend to get higher the closer to the trip that you book), and give a structured and fair way to pay them back. We considered a couple of different use cases and we ultimately chose travel, as it’s something many people might use credit or a credit card for, and it’s time-sensitive.

We’re on a mission to make money work for everyone, and as a few of you have said, loans like this can be legitimately useful. Lending is a part of our strategy for becoming a sustainable business, but we wouldn’t be doing it if it didn’t meet your needs. It’s important to us to lend responsibly.

People use Pots in a lot of different ways. Even though we tried hard to target this appropriately, sometimes when you’ve created a Pot with a specific goal, you’ve already made a decision about whether to borrow or not. As a few people mentioned – having goal dates on Pots would have helped to make the targeting more relevant and avoid confusion. It’s now something we’re considering.

As ever, we really appreciate you taking the time to let us know your thoughts. We’ll keep thinking and experimenting to find out how we can make loans work for the people that need them.


(Dan Mullen) #153

Thanks for taking the time to respond @ellen. My issue with the above is that most credit cards have a lower APR than the rate being offered by Monzo.


( related to Monzo CEO, Investor in Monzo ) #154

Everybody has different interest rates , if you use a CC and pay it off that’s 0%, does that make everybody else rate unusable or predatory if its over 0% ?


( related to Monzo CEO, Investor in Monzo ) #155

unless banks are charging less than 7% are they all predatory loans ?


(Andy Slater) #156

Its not the rate that makes it predatory, its the aggressive selling technique


( related to Monzo CEO, Investor in Monzo ) #157

ohh no I agree - it was an inappropriate position to position the offer - bad Monzo - they have now stopped the offer to 600 users out of their 1.5m customers


#158

Thanks for explaining @ellen. It might have felt like a long time to people contributing in this thread, but that’s actually a super quick response on the issue!

I’ll never agree with loans being next to savings, but until today, I didn’t even realise that “holiday loans” were a thing - So I can fully see where you guys were coming from by introducing it on a holiday/travel related pot.

Anyway, thanks again for coming on :smiley:


(Andy Slater) #159

I sense sarcasm

But i think what you meant to say was

Theyve now realised their experiment in aggressive selling has shown them they’ll have to be more discreet about it in future


(Jordan) #160

Hi Ellen,

Thanks for getting back and giving some background on the who’s/ whys/ how’s.

I think personally it was the marketing on a savings pot and it was the “reach your goals sooner” as I don’t agree that obtaining a loan really does this.

Maybe a banner in the main home page of the app would’ve suited? Something like “we’ve noticed you’re planning a holiday” “we can help you pay for this earlier” - although I’m still adverse to pushing this sort of product as it can be irresponsible.


( related to Monzo CEO, Investor in Monzo ) #161

no it wasn’t sarcasm - I think Monzo were wrong to position it there - Ive said the same higher up the thread - it was the wrong place to put it - there is nothing wrong with loans if people want to use them thats great, its a service , rates vary with providers if you dont like 20% ( I wouldn’t ) find another provider