Hello - I was looking at Monzo Flex and it says the rate/ APR is variable… Is this because the rate/ APR changes in line with Bank of England base rate?
As I understand it, Monzo designed Flex specifically to be a regulated product. I’m not sure that having a fixed APR means it’s therefore unregulated?
More broadly, I thought that the terms were clear. The APR is fixed and specified in the credit agreement. It even says this:
We’ll give you at least two months’ advance notice and tell you our reasons for all other changes (including interest rate changes) in a secure way, using one of our usual channels (see ‘How we’ll contact you’ in our Terms and Conditions). If we’re decreasing your credit limit we’ll usually give you 14 days’ notice unless we think that it wouldn’t be appropriate.
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I think they do. The rate is fixed at the specified percentage rate unless they give you two months notice of a change. There is no contractual link between the base rate and the Flex rate so any changes are at Monzo’s discretion.
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- Flex is very much a regulated product.
- All
(variable)means is that the lender can change your interest rate at a later date - although as mentioned above, this would require a 2 month notice period.
The base rate going up might trigger a lender to want to change existing customers interest rates but it’s highly unlikely given the small increases we’re seeing today. Maybe if the base rate went up a lot to 3% or something like that it might play a bigger factor.
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