Monzo in the media

Right now? I very much doubt it!

If by right now you mean this year then :frowning_face:

A Monzo Credit Card would be cool but how would you want it to be.

There’s Amex Style Charge Cards (A Monzo Amex would be interesting)

BNPL Cards (Similar to Tymit)

Or Rewards and Purchased Offers?

Isn’t that all the more reason to start sooner rather than later? Just be really strict like Monzo is currently with loans and build up from there.

It’s likely not quite as black and white as that but thought I’d throw it out there :grin:

No bugger will have one then :sweat_smile:

There’a a thread of recent opinions you could explore here -

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Thanks :blush:

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That’s not quite right. When one underwrites mortgage on the Bank’s books it is an asset. Previously it was liquid cash, but now it is a loan that is getting repaid. See how mortgage books are being bought and sold, meaning they do have value to them beyond just the outstanding capital.

It does represent opportunity cost, if one ties up all capital in mortgage loans there might not be any money left to pay salaries and code new features and products.

It’s less of a financial loss, and more of an opportunity loss.

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Nationwide is not run to make a profit, it’s a building society not a bank.
It’s run for the benefit of savers and borrowers and only needs to break even.

Saying that they screwed their savers over while favoring borrowers so much can be said.

Where do you get stuff like that from?

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Nationwide is run to make a profit. A building society is not the same as being a non-profit organisation. There are many examples of building societies which collapsed because they couldn’t make a profit.

You’re confusing Nationwide having members not shareholders, with making a profit.

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Similar to John Lewis/Waitrose. They make profit; it’s just that some of that profit is distributed to partners/staff.

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I must admit this did confuse me a lot. As you say, Nationwide is very much run to make a profit, just because it doesn’t give that profit to institutional shareholders doesn’t mean it’s actions are any less commercial than anyone else in banking, in fact they have been, in the past, far more risk adverse in both investments and lending decisions than the big 4 precisely because they want to keep as much of their profits rather than risk bad debts and the like.

None of which is necessarily a criticism of their approach in any way, but the idea that they are somehow almost charitable because they are a mutual is something they have very much encouraged through their marketing as it’s a nice hook to get people in through the door, but they are as much commercially minded as anyone else, even if their ‘red lines’ are perhaps more conservative than other banks.

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The bonuses they pay their ceo are just as large. And I’ve never received any dividends from them as a member.

I do receive nice 7.25% off their PIBS. However these tend to be repaid at first opportunity. It seems they are more concerned with running AT1 bonds and repo programmes in USD, EUR, and GBP. No idea why. I guess they make more money with more capital, whilst in fact just paying interest to big finance institutions.

I wish they offered savings rates at AT1 rates of their bonds.

I’m surprised there has not been much mention of the calibre and background of the new investors… even the article glosses over it and moves swiftly on to Tom leaving etc.

If anyone wasn’t aware - Jerry Yang is a multi-billionaire Internet O.G. with deep ties in Silicon Valley and Asian tech (founded Yahoo in mid 90’s and on the Board of Alibaba having mentored Jack Ma and backed him with $1bn early on, Alibaba currently worth ~$600bn).

Nikesh Arora is a former senior exec at Google and President of Softbank and is the current serving CEO of $35bn cyber security behemoth Palo Alto Networks. The fact that he is investing in Monzo on a personal basis rather than via a business or investment vehicle says a lot.

Another huge vote of confidence from Silicon Valley veterans here.

If you thought Monzo was going to slow down, break even and sell out to Barclays for $2bn then you need to look at the ever growing list of US billionaires, tech insiders and top VCs stacking their chips on Monzo. The next few years are going to be big!

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Aren’t those the guys who invested in WeWork despite all the red flags?

Considering Silicon Valley’s modus operandi has been to pour billions into even the stupidest ideas in the hopes of one of them making a profit, I wouldn’t look too much into this. I’ll change my mind when I see actual profit, but so far I fail to see how Monzo can ever compete with Starling in the UK. US is a different matter though and I do think they have an amazing opportunity disrupting the antiquated banking market there.

so are you saying Monzo is a stupid idea
? :slight_smile:

Im always disappointed on the assumption between Monzo 'fanboys" and Starling “fanboys” …and indeed Revolut …that its got to be either Starling, Monzo or Revolut that succeed …and the view that only one of the three can …exclusively " succeed"…

I mean its not like Lloyds, Barclays, HSBC , Nationwide , Coventry BS , first direct, Metro, the Coop etc etc are offering similar services in the same market place

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you saying Monzo is a stupid idea

No, I’m just saying that Silicon Valley investing into Monzo shouldn’t be seen as an indicator of anything when you see what else they’ve been investing in.

Regarding the “stupid” idea, it’s not stupid per-se (it used to be a great product and modernized the UK’s banking industry), but you can’t deny that when it comes to profitability it’s not working out very well.

Also this isn’t a Monzo vs Starling issue. I’ve had my own grievances with Starling. It’s just that Monzo as it stands is no longer a good value product compared to the competition, and in their push to profitability they’ll need to make it even less good value. So my argument is not about Monzo versus a specific bank but about the fact that Monzo’s product is no longer good value and if VCs keep pouring money into it they will expect a big return which means making even more user-hostile changes. I merely picked Starling because it’s the most similar product when it comes to Monzo, but most legacy accounts would fit the bill too when it comes to value for money (except maybe on payment decline fees?).

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well Ive just cassed over my starling account to first direct admittedly for the 100 sweetener … and from my initial impressions of FD wow …they seem to be way behind all three rev, starling and monzo from first impressions , the security set-up alone was so painful I was thinking about abandoning it within 5 minutes of the contortions required for passwords and the app is pretty horrible compared to all three .

As to profitability I think Monzo were doing pretty well pre pandemic and I see no reason for that to change when we finally get released from this hell that we are in , they are lending money in overdrafts from their “own money” , interchange will come back , their business accounts are doing well from a slow off the line start, their paid for accounts also seem to be gathering steam , not forgetting not many people require holiday insurance at the moment , so again the release of the prisoners should see a very healthy uptick in the premium accounts, and it has been reported, I think, that revenue has had a 30% increase during lockdown.

As to the Monzo product being good value, I think it is , I dont have a business account with them , I dont yet have plus or premium , for me when travel gets released I will seriously consider the premium offering , Monzo make money off me from fixed term accounts I have with them , energy supplier I arranged through them, interchange when I travel, Im quite happy with the product as the free service . Monzo make money from me as a free service .

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I’ve just opened a HSBC account (out of interest more than anything else) and it was such a painful experience.

The actual sign up was fine, but it took 4 days for my card to arrive, followed by another 4 days for the PIN, and it was 12 days after I initially opened the account before my “telephone banking code” arrived so I could sign up for online services.

I started registering for online banking, but then it told me that it wouldn’t register me for mobile banking, but if I registered on the app it would register me for BOTH online and mobile banking.

So back to the app, and I now have different logins for mobile and online banking, different passwords and (I think) different security questions - it took longer to set up the security questions than it took me to sign up for a Monzo account 5 years ago :rofl:

I also think people who reckon Monzo can’t make a profit will be a little surprised in 12 months time and will be eating their words… (or will it be me?? See you here in 2022…)

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