I take it the extra costs are things like KYC and AML and the like, some of which are handed off to third parties?
A few benefits I can think of off the top of my head of pots over multiple bank accounts are:
Better visibility of finances - while multiple current accounts could be shown in app, things like Savings Goals would be much more difficult to implement.
Better integration within a main spending account - allows Monzo to implement things like Round Ups and IFTTT without endangering security by allowing money to be moved between accounts with user authentication.
Fewer card needed - more cards = more chance of confusion, which would (imo) lead to a worse customer experience. Multiple account and card numbers could also cause confusion when setting up recurring payments.
Potential for better recurring payment management - only having to use one account number and only card number when setting up recurring payments (direct debits & recurring card payments (CPAs)) and still having an easily visible, ringfenced place where they are taken (hopefully the suggested Committed Spending Pot).
I don’t understand…Monzo is innovating here, allowing you to manage all your money sensibly in one bank account and people just want to open multiple accounts to manage their money. What’s stopping them from walking into their local town centre and visiting the multiple old fashioned banks and opening an account? (they could even go to each of them if they liked!) You don’t need Monzo to do this…
If I commit to shaping my finances around the ‘pots’ model; a pot for this, a pot for that (all a logical abstraction upon a single regular bank account), what happens when I CASS to another bank?
The fine granularity of my finances disappears and I’m left with a single (new) bank account. How much of this bank account is for me and partner to buy fuel? How was much was for our year-long savings for a holiday?
But if pots were accounts you’d still need to open the equivalent amount of accounts elsewhere. And you’d need to individually CASS each pot to a new account.
Is that a problem? Stuff like “Know Your Customer” is a PITA for Monzo I’m sure, but surely there’s no scarcity of bank accounts that can be made in the UK? Monzo was able to a create a second account, a joint one, very quickly and easily. Why not a third or n’th?
Luckily for me, I still have my original accounts with my old bank, so I can’t misspend money meant for my car on my evening meal out. Nor do I have to shuffle money in/out of pots marked for ‘car’ or ‘entertainment’ in the queue at the Esso garage. If Monzo supported multiple accounts, then account 1, 2 & 3 would be CASS’d across to Monzo-1, Monzo-2 & Monzo-3.
I’m not sure it was quick and easy, and full functionality still isn’t there (like CASS)
I also think this has been innovation for the sake of it. I’ve got a long list of custom-named accounts with bunq and I can see my financial situation at a glance in a way that I just don’t with Monzo.
I can also link the three cards to any of the accounts I want, which is actually the most useful feature, separating boring transfers from actual spending.
On the other hand, I’m not fanatical. Why should this be an either or? Why not allow lots of accounts and pots? I really don’t see why it should cost huge amounts more. Maybe someone could enlighten us on the potential costs.
I think the added complication for the user would be Monzo’s issue here, not the additional cost - similar to why they’re not a fan of custom categories or giving a toggle to loads of features.
^This is all pure speculation though.
I closed all my other accounts when I eventually became #fullmonzo. I no longer see the need for multiple accounts, it’s a lot of maintenance and I hated carrying around loads of cards.
Account does not equal card!
I think account aggregators are probably the way forward anyway. It will be really interesting to see the first third party payment initiator.
The category thing has been rumbling on for ages. Emma should have custom categories soon. Problem solved
Can we push this into the 2019 roadmap contest? Having multiple accounts (i.e. sort/account number on pots) would be amazing and much cleaner than one single account for all the bills!
It doesn’t have to be with multiple cards, it’s just a handy way to split money in different actual accounts.
This sounds like a good idea to get rolling in the feedback voting thread!
Since I moved my billing account to Monzo, and my spending account elsewhere, I really would like to have a separate spending account in Monzo without the overdraft (the overdraft is where in case I don’t get paid one month). With joint, and soon business accounts, it should be a possibility.
This is THE thing stopping me going #fullMonzo.
At present I have two Bank of Scotland accounts, and this is why. One for all bills (standing orders, direct debits), the other for ‘Cash’.
Mimicking that in Monzo would be wonderful. And no I don’t think Pots are a good enough solution.
If the committed spend pots comes into play where the direct debits for your bills would come directly from your pot would that cover your needs?
This is a pointless as chocolate teapot
Pots in current form are more than adequate!
Personally, I have only every had 2 accounts with a bank, a current & savings account, except when opening a joint account and still keeping my personal one until everything transfered.
I don’t think that it would be manageable to have separate pot “accounts”. The ease of opening and closing pots would make this slightly unfeasible in my opinion.
Furthermore, If committed spending pots come to Monzo - does this not (with IFTTT integration) solve this issue? I struggle to see how having 5 different accounts is better than having 5 separate pots? Unless I’m missing something?
Direct debits assigned to certain pots would be a good start. I’m not that bothered whether the segregation is done via pots or via a full bank account with a sort-code - I would just like to be able to silo money somehow and direct my payments (cash withdrawals, direct debits and card payments) to those silos accordingly.
This is a pointless as chocolate teapot
It really isn’t. As it stands now, my single bank account with Mozo is just a giant lump of cash (I wish…) with no way to easily silo cash into pots that can also be conveniently accessed regularly.
Example of pots working well: saving for an annual holiday. Every payday £100 goes into my ‘Holiday’ pot. At the end of the year, I release the £1,200 and buy my holiday with my mastercard. This works pretty well IMO.
Example of pots not working well: I set a personal budget of £200/month on groceries. Every month after payday £200 goes into ‘Groceries’ pot. I then visit Tesco and spent £47.13 on my weekly shop. I then manually have to transfer £47.13 from my ‘Groceries’ pot into my general account. When I forget to buy milk from Tesco, I go to the corner shop, pay £1.33 for some milk and remind myself to AGAIN go into my pot and release those funds. This is a manual process is an era of (alleged) automation.
If my ‘Groceries’ pot was a regular bank account, with its own Mastercard with a shopping trolley drawn on it, I could spend that £47.13, and see it come out of the account. When I realise I forgot to buy milk, I use the same card again, and see SPAR charge me £1.33 for milk.
This ‘Grocery’ example also introduces the requirement of some sort of ‘float’ in my account. If I want to spent £47.13 in Tesco, I need £47.13 available to my Mastercard, which is then manually replaced by my pots transfer in the car park (if I remember to do so, of course).
To you perhaps.
I struggle managing debt and spending habits, so having an entirely separate ‘not visible’ place for bills to make sure they get paid, has been a huge benefit to me.
Fine, pots work for you. But stop judging others please.