Monzo: investment, profit, VCs and crowdfunding


(Alex Sherwood) #42

It’s the cost of providing customer support (see 9:52 in this video) & it’s monthly annual.

Also, what @awjdean said :slight_smile:

Edit - to correct my mistake after awjdean pointed it out.


#43

26% then


#44

So it’s an annual breakdown not a month?


(Alex Sherwood) #45

I guess we’ll have to wait & see what fee structure they come up with!


(Alex Sherwood) #46

To get to the annual totals, you’d need to multiply those monthly figures by 12.


#47

From rewatching the video, I’m pretty sure these are the annual totals.

NB: as far as I can tell, they don’t actually say if all the figures are annual, they only say the overdraft one is annual. However, it wouldn’t make any sense to add up some annual figures and some monthly figures, so it’s safe to assume all those figures are annual figures.

It’s an annual breakdown.


#48

Why does it say October?
It must be monthly otherwise some of those figures are drastically too low.


(Alex Sherwood) #49

Ah ok thanks, either way, the main thing is that the net figure is positive :smile:

Edit - yes you’re right, they say the customer operations cost is annual too.


#50

Sounds like they’ve extrapolated using the costs for October.

In other words, they’ve taken the figures for October (and maybe a few months before that) and used those to calculate what the figures would be if the average cost of running the account and the average income from each account remains the same for an entire year.


#51

If so, that’s fair enough, but still will be difficult to charge more than 26% on overdrafts


(Emma (still not the app)) #52

This is so off topic now but if people aren’t as clear on how much it costs they’ll be more likely to pay more as they’ll lose track of the charges. Unless it’s made super clear in app.


#53

Surely it will be transparent


(Jordan) #54

It was a long off thread topic attempt at explaining something so I asked the coral crew to separate it into its own topic so it decluttered the other one - sorry if thats upset you :rofl:


(Alex Sherwood) #55

Yes it will but unfortunately that doesn’t mean that it will be as easy to manage as the current fee structure. A lot of people find fixed fees easier to interpret than percentages. So Monzo initially went with fixed fees because of user feedback.


(Splodf) #56

Is it not simple enough to have a simple slider alongside the apr % to calculate a daily percentage once Monzo switch over?

You want to borrow X @ Y (APR) this will cost you Z per day.

I’m not sure 50p per day really is that much clearer, easier, but not clearer.


(Alex Sherwood) #57

One of the main differences with a % based fee is that the amount that you pay increases as you borrow more. So it’s much harder to predict what you will end up paying at the end of the month.

Whereas fixed fees let you calculate that there’s X days left in the month & you multiply 50p by the number of days, to get to your monthly fee. And you know that you can only ever end up paying £15.50 per month.


(Splodf) #58

I dont know.

Adding a slider, calculator or whatever is no less or more transparent then just charging 50p a day.

Keep the slider there at all times so people can make a constant or worst case scenario check.

I totally get your point, but I really do think it’s the easier option to understand and apply, but not the best for all occasions.

Irrelevant really, it seems like Monzo will have to change it shortly, regardless of what we think!


(Emma (still not the app)) #59

If you have 1 income and tend to only go into your overdraft at the end of the month then it’s difficult enough eg £30, £45, £70, £70, £120. Current system that’s £2.50, Apr system it’s errr…


#60

At worst the monzo overdraft is 900% and best 18% so let’s be honest it’s nothing to do with clarity.

If you want clarity set it at 18% and cap it at 50p


#61

Apr system it’s errrr…less