Monzo Plus - Small Scale Trial

Nationwide FlexPlus.

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But (for me) this is a bundle from one organisation. Itā€™s not my concern how many suppliers Monzo transact with on the back end. I would imiagine that Monzo receive a commission for each customer they sign up so Iā€™m not expecting it to be loss making.

Sourcing is a one off activity and shouldnā€™t factor into the ongoing costs across x thousand customers. Having it available in app is actually cost saving compared to other banks who would need staff to get you to sign up.

I havenā€™t looked in a while, but when I originally signed up with Nationwide I struggled to make a material saving by buying the component products myself. Iā€™m not saying I couldnā€™t but it was/is a great value bundle without even factoring in the convenience. Once you add on a joint account holder you effectively half the cost per person.

But again, for me the point of buying the bundle is to get a discount. Thatā€™s just how bundle economics works.

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From a customer facing standpoint - yes. But the individual products arenā€™t all Monzoā€™s. Even with a commission thatā€™s unlikely to cover the costs of administering and managing the plus aspect for each customer.

But the ongoing management of that account will cost money and will therefore require the premium so that Monzo arenā€™t haemorrhaging money just to have a ā€œbundleā€.

This is a valid point and argument - but is also one of the major banks in the UK so have the clout to be able to put forward an ā€œalmostā€ as good as worth it deal.

But there is also a difference between a Plus feature and a Bundle feature - naturally the two cross but you are in effect paying a premium for extra things - if you wanted the cheapest deal youā€™d put in the time (and hassle) to find the cheapest deals - not just go with the ā€œbundleā€.

But I definitely agree that a bundle should also be cost incentivised - just I canā€™t see how it would be as cheap as going direct/ individual - at least to the extent a Nationwide account goes.

Granted that this looks incredibly good value - although Iā€™m sure if you really wanted to you could find them cheaper directly or individually.

But this looks to be almost the gold standard of package accounts and so I think it is slightly unfair to be using this as the complete benchmark as Nationwide will have a lot more power to be able to create these sorts of packages.

I do agree though that the above trialā€™s with Monzo are a little off the mark.

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Forget all the other benefits with FlexPlus - travel insurance, breakdown cover, etc. - you cannot get cheaper mobile phone insurance anywhere! Iā€™ve spent a lot of time looking, no-one will cover all of the phones in your household for Ā£13/month.

I do think that FlexPlus is the best packaged account available but there are others - Halifax, NatWest, Barclays, etc. - that all offer decent value and a saving on the individual product prices. If Monzo donā€™t offer a package that is cheaper than going direct, what would be the point of signing up?

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In my view? Laziness. People who will pay for the ā€˜benefitā€™ of not having to search this stuff out themselves if they want it.

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Nationwide literally offer insurance as a stand-alone product, they therefore have the ability to provide services at a much discounted rate - Monzo donā€™t have that - the idea of a ā€˜Plusā€™ account is to have it all in one place - thatā€™s part of the ā€˜premiumā€™ you pay.

Again all MASSIVE players that will have the clout to create an almost at par value package (likely with their own insurance and/or partnered insurance companies providing the products).

I think we need to slightly pull away from the idea that this is a ā€œpackageā€ of Monzo products - its access to extra things that you canā€™t normally get.

I donā€™t mean to target this at you as you obviously havenā€™t said it, but so often on this forum people are so quick to criticise the "legacy"banks and take glee in how superior Monzo is.

But thatā€™s a two way street. It doesnā€™t have to be the absolute cheapest but it should be competitive on some vector (price, convenience, features etc).

So many of the best parts of Monzo are down to its structural advantages (digital only, lack of technical debt, built on modern technology and using internet economics) but no one gives old banks a pass for not having any of these advantages.

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So, if they canā€™t compete on price, and they canā€™t compete on ease, what is the Plus account competing on?

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None of the products in the FlexPlus package - other than the account interest rate, fee-free foreign ATM withdrawals and Ā£250 fee-free overdraft - are provided by Nationwide. They are provided by UK Insurance Limited (travel insurance), Lifestyle Services Group (mobile phone insurance) and Britannia Rescue (breakdown cover).

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I completely agree here, I said on the previous Monzo Plus thread that Iā€™m not sure how a plus account would work well for Monzo - the Legacy banks have the products already and offer great package accounts.

Again I agree, this is only a trial and the hope is that they go back and revise it and work on it to make it more cost effective for the customer with some more features in (loads of features that sound good were mentioned on the previous thread).

Iā€™m not sure what you mean here - but all in all the Legacies naturally do things better.

Is having the insurance tied in with your main banking provider not competing on ease?

No ā€“ I get that with every other cheaper, more fully-featured packaged account.

Ā£132 for a years travel insurace?!?!?!?!?!?

That does not sound like good value to me.

Iā€™d rather get a cheaper travel policy and some cash back at the same time.

But if someone banks with Monzo - they might not want to have a separate packaged account - therefore the ease for them is the feature they like.

I agree that the Monzo offering needs to be greatly improved, but I just think that it wonā€™t initially be able to compete against the legacies. (look at the investec savings pot as a prime example - it was still used up even if there were better rates around).

Yes, not being able to select opt-ins on the insurance like winter sports at sign-up is rendering it not very useful, for me at least.

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Itā€™s ~Ā£60/year travel insurance. It still isnā€™t good value, of course, but Ā£132/year is inaccurate.

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Then it comes back to a willingness to pay a premium for using Monzo. That doesnā€™t seem like a good thing.

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So it may not be their own product, but they still have the power and clout to have the discussions with the insurance companies to create a much much better deal.

Monzo right now are unlikely to be able to have the same sorts of conversations.

I agree, I donā€™ think the offerings are that great - but I donā€™t think any offering will definitely beat the Nationwide offer. I think (well, hope) that Monzo take heed, add things in and reduce the price.