Interesting concept! I’d still think that for those who are able to get a credit card at all, a credit card is still a better tool to build a credit history, because, as @j06 put it, they are a powerful budgeting tool (and you can put your money into actual, interest bearing accounts in the mean time), but it is undoubtedly great that there are alternatives available.
This has me wonder, though: Is the number of people who can’t get any credit due to a lack of history really that large in this country? Even when I first came into the country without any credit or address history, without even a paid job, I was accepted for a credit card almost immediately. The original limit was silly low (£400 I think), but they increased it quite quickly once I got my first paid job. The same applies to my wife a few years later.
Or is it just that people don’t know they need a credit history until it’s too late? In that case Loqbox isn’t going to help either, because, well, if you don’t know you need it, why would you get it?
I love the concept. Ok you’re loosing a years interest (which wouldn’t be much on those amounts) but unlike a credit card I wouldn’t be tempted into the i’ll Just get that and I’m sure i’ll be able to pay it off next month mindset.
History would be a bigger issue for young people, more of who live at home for longer but a big part is rebuilding history after defaults or bankruptcy
I know this in old topic but I’m new to the forums and it concerns something I’m interested in.
I too would be happy with a ‘credit’ card that doesn’t offer credit - I always pay mine off in full - but I do want the legal protection that goes with a credit card. Combining that with the security of Monzo’s immediate notifications would be a real winner.
However, I would still be reluctant to give up my cashback. I get 1% on my American Express card and 0.5% on my Barclaycard, earning in excess of £120 a year combined. I’m not interested in other rewards and that would be a lot to turn my back on just for the convenience of having my spending show in the Monzo feed.
If Monzo ever went for credit cards they’d have to offer credit, not ‘credit’. Otherwise, that’d be a misleading product.
I think you should contact your MP to get a Consumer Debit Act. In that sense, we want Apple Pay, but that doesn’t mean we’ll get it
Without getting the business that revolves around credit it is very unlikely that Monzo could match or even offer such cashbacks. As far as I know they’re working on some cashback with Retailer Offers because retailers usually absorb the cost to attract more customers.
Without trying to sound very snappy I think you should checkout products like moneydashboard.com which let you add banking services from other providers and help you categorise spending.
No, that doesn’t sound snappy at all - it’s helpful.
Equally, I don’t want to sound like I want Monzo to be something it isn’t. I appreciate it’s a bank offering a current account and it wants to be the best at just that. I’m really just thinking out loud about how Monzo matches my present way of managing my day-to-day spending, how it differs, what I could do differently to take advantage of Monzo and how Monzo might develop in the future.
I think they’re just being very wary of the way they do business and I think that’s a good sign. Tom said that traditional banks just focus on selling more and more mortgages and credit cards and Monzo doesn’t want to be that kind of bank. But they have to make money somehow so they just started doing overdrafts.
They’ll be moving onto the marketplace to make money so I think that credit cards are going to be out of the picture for a very long time. But who knows, they might be able to get a deal with credit card providers to integrate their platform into Monzo so that you can check your amex card balance in the Monzo app (with the spending categories and everything)!
I’d always keep a credit card separate and on a different payment network, i.e Visa. That way you’ve got a bit of redundancy if there was any issues at Monzo, or MasterCard. I’m always bouncing between different credit card companies as to chase the 0% interest offers.
Up to you, but that’s my opinion
More credit card providers should give customers the option of choosing between Visa or MasterCard after being accepted. Is there any reason this can’t be done at present?
I know that mbna offers dual Visa and Amex cards for the same credit card account at the moment.
Good recommendation but as previously mentioned one should diversify. So if you are Monzo customers go for Visa as Halifax CC runs on MasterCard network.
I have had such bad experiences with legacy banks that it would be great if Monzo offered a credit card. Is there a reason why it’s not on the roadmap?
Agree that having the option between Visa and MasterCard would be good to diversify networks given recent issues.
Credit card providers and banks are separate entities. There isn’t really any reason to have them with the same company - indeed you miss out on the best offers that way.
My credit card has 0% on transactions for 18 months. When that runs out I’ll get another one with the best deal available at that time. No way I’d stick with one company, or expect a bank to match that.
Unfortunately for those trying to avoid the same network, all the best travel cards seem to be on Mastercard. Barclaycard seems to be your best option for a zero fees Visa, and that’s time limited (albeit until 2022!)
Why should credit cards and banks be different entities?
Only reason I use a credit card is because rental car companies and hotels require one (also useful when traveling with work). I would never ever consider using a credit card with the crazy interest rates. Plus interest free periods and reward points just seem like a waste of time.
