Our borrowing principles

For those of you who’ve been around for a while, you may remember that we shared our lending principles back in 2019. Since then we’ve launched Monzo Flex, improved how we work with people in financial difficulty, and we’ve got a lot more customers who borrow money from us. With these changes and lots of feedback from customers on what’s important to you when borrowing money, we’re refreshing our principles to make sure that they still reflect how we think about borrowing at Monzo.

Our mission at Monzo is to make money work for everyone. This includes money that you might need to borrow to achieve goals like buying a car, paying for a course, or improving your home.

We know that the idea of debt can be daunting which is why we’re serious about doing things differently at Monzo. Our borrowing principles are a commitment to being a responsible lender and keep us focused when solving problems and making decisions.

We’re committed to 3 borrowing principles

As part of our commitment to being a responsible lender, we follow 3 principles. This is our promise to you, and shows what you can expect if you borrow money from Monzo (whether that’s a loan, an overdraft, Monzo Flex or other products we build in the future).

1. We keep you safe and feeling in control

We want to protect people from getting into unmanageable debt. So we have a strict criteria of who we lend to, and decide using info from our credit reference agency, as well as our own data.

You can change your mind about borrowing with us any time and repay in full with no charges for doing so. With Monzo Flex or an overdraft, you have control over your credit limit - it’s quick and easy to reduce it in the app or close your account.

2. We’re upfront and honest about the costs and considerations of borrowing

We’ll always be upfront about what borrowing will cost you. And we’ll show you what that means in pounds, and as a percentage. Plus, we don’t charge any extra fees for borrowing with us - no fees for taking out a loan, overdraft or Monzo Flex, no fees for paying back early and no late fees.

And if we need to use complex terms for legal reasons (like APR), we’ll always explain them. So nothing’s harder than it needs to be.

APR stands for Annual Percentage Rate. It tells you the rate of interest you’ll pay on an annual basis including any compound interest and expected fees. It won’t include missed payment fees or early repayment fees (but we don’t charge these).

3. We’re fair and flexible if your needs change

We know that life can be unpredictable, and things change, so we’ve got a team of people dedicated to giving you personalised support. Especially if something’s wrong it’s important to contact us so we can help, whether that’s losing a job, struggling with mental health, or something totally different).

Depending on your circumstances, we can give you extra time to pay back, come up with a more manageable repayment plan or refer you to free advice organisations, if that’s what you need.

You can speak to real friendly humans over live chat through the Monzo app. We’re here 24/7 for emergencies, and from 7am to 8pm for anything else.

We’d love to hear your feedback and ideas

We’re sharing these principles with you because we want to be held up to the high standards we’ve set ourselves. We believe in everything we’ve said, so if you see us falling short then please let us know. And as always, we’d love to hear any other thoughts and feedback in this thread!


Hey @DaniShipp

Firstly thanks for sharing this - I haven’t as yet needed to use the loan function in Monzo, but it and flex seem to work quite well for folk here. Perhaps those with experience can help.

I would refer you to the below thread however, I’m not sure how “partnering” with high APR lenders (yes, I know people could go and google themselves) helps people feeling safe and in control.

When Monzo can’t offer a loan, does it offer instead other options in terms of who to speak to for advice/help and prevent people who might be in a desperate situation from turning to one of these companies, which Monzo then makes money out of them for?

Not trying to deliberately bait a bear here, genuinely interested in what Monzo’s thoughts on this are.



Thanks for the reply!

We’ve been experimenting with referring customers to carefully selected third parties when we’re not able to lend to them to see if customers find it useful.

We use a number of rules to help decide when it’s appropriate to refer a customer. The most relevant to your question is that we never refer any customer if there’s an indication that they might be in financial difficulty, or have indicated that they have a vulnerability that makes this product an inappropriate fit for them.

Different lenders have different criteria and serve different parts of the market. When we can’t approve a customer for a loan it doesn’t necessarily mean that they’re in difficulty, just that they don’t meet our criteria at this time.

We will always offer support and signpost customers to relevant services (like Step Change and the Money Advice Service) if it looks like they’re in difficulty or tell us that they’re struggling with debt commitments. We’ve also reviewed our partners processes to make sure they offer the right support to any customers who find themselves in financial difficulty.

Hope this helps!


I vaguely remember this. Could you flag where to find the old principles, please? And maybe give a quick run down of what’s changed and why?

That’s a really insightful answer, thanks for taking the time to write it.

I like Monzo lending. Super clear and transparent. The rates are high, but the experience is good.

Just a thought, have you ever thought of flagging / looking into where flex is being used for everyday necessities like groceries? I know I did it when I was in financial trouble, I’m betting it will happen a huge amount this winter.

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It was apparent on many accounts they’d use it for essential spends.

Even easier now the first instalment isn’t applicable at time of purchase.

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It may be hard to tell, you might go to Sainsbury’s and tag it groceries but really you put a new microwave in the trolley or something.

But, combined with other things could be a reason to at least reach out to someone and check. To make sure your loan product isn’t fuelling a poverty crisis etc.

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When it’s £3.50 at Sainsbury’s every day it’s not a microwave, maybe a microwave meal.

I worked findiffs here and another bank to know :sweat_smile:


I’m always in two minds about this.

If you look at my account, you’ll see that I’ve flexed a bunch of stuff that might be classified as essential. But i use it in the same way as i use a credit card and pay it off before accruing interest. I’d probably react badly to anyone looking through my purchases and asking me to effectively justify them. I’d probably just stop using Flex.

But then again, you do want to make sure that folk are using credit responsibly. I wonder if there’s a more interesting approach which looks at default rates, unsustainable debt or whether folk are using chargeable BNPL for basic necessities.

But if you do find out that that’s happening, what then? I think I’m more in favour of changing the shape / policy of the lending products rather than direct intervention with customers. But it’s a tricky one.


I agree, I mean reaching out to people who might be in financial difficulty is a thing banks do I think. But I don’t mean everyone that flexes a sandwich!

Other things you could look at, other approaches such as a simple flow that pops up and says ‘was this item a one off purchase’ or something like that. After all, a responsible lender shouldn’t really be lending to someone who can’t afford their normal groceries.

At a minimum though I think if it would be nice to know if it was looked at internally, tracked, spoke. about etc or just kind of glossed over as ‘one of those things’

Edit: also didn’t mean to derail the thread. I think Flex is an excellent product, I just wanted to use the opportunity to ask someone on the team if it was something previously thought about.

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