Monzo savings

Barclays do something similar in that the will pay you £7 for two direct debits for £3.50/m so you make £3.50/m, plus cash back at retailers etc.

As for your interest, as @NeilM made a very correct point, no risk no reward. People have all these systems to make on average maybe 2.5% (I believe its around this once you count for money in/out, regular savers etc.), but you can make that money just putting is in a an ETF or similar with a higher allocation of bonds etc. without the account juggling.

Savings accounts within banks are basically just convenience accounts to separate money. They’re very low interest bearing pots, and have been for a long time.

Keep in mind if you need anything more, cheques, cash, international payments etc. Monzo doesn’t do this, or they do it at a cost to you.

Monzo is a very basic bank still, make sure it actually fits your needs before switching.

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My intention would be to keep my Santander and Metro accounts for backup anyway, I will never close the Santander account to be honest because I can remember the account number.

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Good discussion. Hope it has helped answer your original question, about why people use banking products which aren’t necessarily offering market–leading rates.

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Monzo will also not want to be rate leading as it attracts all the rate tarts that just follow around the highest rate. I think there is a fine balance of being close to the highest rates, that make it attractive and rewarding to their customers without attracting the wrong type of customer.

For me personally the Monzo rates are just to low to be worth my while, however I am fully aware that for the majority of people the convenience will out weight the return, especially given the actual difference in money terms.

People don’t seem to get that people like Santander offer you higher rates than other people as they’re a loss leader to get customers using them so they can screw you in other areas. Monzo won’t be able to offer the same incentives that other banks do as they’re structured differently. Savings rates worldwide are currently severely depressed from historic norms as there’s a lot of money floating about wanting good returns and very few places to invest it for a high, safe return.

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I’m interested in what those areas might be.

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