âMonzo lends customers money to buy its sharesâ
@BenC has done a good job of explaining whatâs wrong with that. Itâs making a link that is not present and never has been.
Monzo extends an overdraft to customers who have applied for one and passed the tests.
Monzo have not and would not extend an overdraft or offer a loan specifically to buy shares. What customers do with their money is their business.
Well, sure - As it hasnât actually started yet, thatâs not true right now.
But the point is (as far as I can tell), Monzo will be lending money to people so they can buy shares.
Not specifically for that purpose, but as a by product of the fact that Monzo are a bank, that offered overdrafts, and are crowdfunding through their own app.
All you need to do is look through the crowdfunding thread to see people who are likely going to use an overdraft to fund the purchase of Monzo shares.
If by some miracle, no one uses an overdraft to buy their shares, Iâm sure the Monzo media team will be all over this asking for it to be recinded (and rightly so).
Donât disagree. But the article is giving the impression of a grey area, and thatâs what I think people will pick up on.
I think the more effective counter argument (than thereâs nothing stopping people using their overdraft to buy shares in general) is thereâs nothing stopping customers of other banks using their overdrafts to buy shares in that bank.
Itâs basically concern trolling over an issue that is a result of the function of a bank. đ¤ˇ
But yeah I agree itâs technically accurate just apparently worded for sensationalism for whatever reason. Or, at least, can be easily misinterpreted as such.
UK journalism in a nutshell 
A better question/debate should simply beâŚ
Should a bank allow the use of overdrafts to fund the purchase of shares in said bank?
Talk all you want about adults making informed decisions, but a quick look at the crowdfunding thread shows that there are a lot of people who arenât experienced, donât fully understand the risks and could potentially be caught up in all the hype of the forum.
The gambling block is there to protect vulnerable people, and there are undoubtedly vulnerable people who could get into financial trouble having seen the various valuations and potential share prices being thrown around, thinking itâs a get rich quick scheme.
Personally, Iâm generally in the camp of âlet them make their own mistakesâ, but that applies to the general public, and not those who are vulnerable in any way shape or form.
As already stated, Monzo wonât be doing this. At all. At any point. âMonzo will lend money to people, some of whom may use the money to buy sharesâ is in no way the same as âMonzo will be lending money to people so they can buy shares.â The relationships between the two parts are entirely different.
Yes, and youâll also see plenty of people saying itâs a bad idea.
Look, I might use my Monzo overdraft (n.b. I donât have an overdraft) to buy drugs (I donât buy drugs). Does that mean the Times could run an article on how Monzo lends their customers money to buy drugs?
Donât forget also the only person quoted is quoted as saying that using an overdraft to buy shares is a bad idea. But he doesnât mention Monzo. But the write of the article uses the quote to attack Monzo. This is an inaccurate representation of the quote.
Honestly, the Times article couldâve just been âMonzo will be launching a new crowdfunding round. Some customers have said they will use their overdraft to purchase shares. This is a terrible idea and other customers have already said so. Perhaps Monzo themselves could do more to push back against this, even though they arenât doing anything wrong in themselves.â That would be more accurate, and fair. And I guess less likely to get clicks.
At the risk of going around in circles, I personally didnât initially read it as Monzo specifically were allocating funds to people in order to buy shares.
I read it as simply the fact that customers were being allowed to use their overdrafts if they wished (which falls into the whole âbusiness/loans/sharesâ issue the article describes.
Every article out there is an angle on something. Sadly, fair and unbiased reporting is pretty rare these days!
We canât dictate what people do or do not spend their money on, overdraft or no overdraft.
Our in-app flow for investing means you have to answer questions that ensure you understand the risk of investing, and you are required to read the investment prospectus first.
But you do dictate remember you have a gambling block which can only be disabled after going through to customer service and nowadays customer service is hard to get to. So IMO, in this case, Manzo is dictating.
We can disagree with the article but it highlights an important issue and I think itâs because Monzo had to accept some restrictions and crowdfunding is only being done via their own App. This can seem irresponsible but as previously highlighted if this crowdfunding was at Crowdcube nothing would have stopped someone using their OD.
What is interesting is that currently you cannot use your overdraft at your leisure. It does not allowe you to send money to another person, a joint account, or a pot if you are in the overdraft. So it does seem strange that you can use it to buy shares when you are restricted in many other ways.
If you could use the overdraft at will for any purpose then I would disagree with the article as just headline grabbing. But given existing restrictions it does seem strange (I would guess it is because the payment is a card transaction and these are allowed to use the overdraft. 
Tom was on BBC Breakfast this morning.
This is excellent! Monzo are literally national news and itâs happening more and more often.
Whatâs that quote? something about âno such thing as bad publicityâ?
No one is going to remember this rubbish news article in the future but many have now been introduced to this new bank called Monzo ⌠all thanks to free advertising from the Times.
Cheers!
16 posts were split to a new topic: Crowdfunding - Investment or Gambling?
Iâve split chat off to a new thread to allow discussions to continue there
2 posts were merged into an existing topic: Crowdfunding - Investment or Gambling?
Hereâs the headline in the print version:
The article felt deliberately misleading and sensational. We have a blog post going out about this very shortly.
Perhaps Iâm just numb to the UK media these days, but I tend to ignore headlines (although I appreciate thatâs probably where a lot of people stop reading, so I can see how it may look misleading).
Iâll be interested to read the blog, as I canât remember many times a bank has been in this situation (enter someone with an article pointing out when itâs been done beforeâŚ).
Either way, Iâll try not to use too much of my overdraft when investing! 
The Times are very critical in what Monzo are doing in regards to the Crowdfunding. Basically saying that you can go into an overdraft to invest, with no way of paying the overdraft off. (Paywall)
Would love to hear peopleâs thoughts on this.
I actually can see the issue here, but I believe itâs up to the individual to make the decision.
There is nothing to stop any other bankâs overdraft being used to buy stocks and shares, so I donât see why this would be any different.
I donât think that this is a problem unique to Monzo? Anyone can go into their overdraft anytime and spend the money however they want, responsible or not.
Discussed here;
