Our lending principles

For some people, the very idea of debt can be daunting. And that’s not surprising, given the industry’s reputation around sneaky hidden fees, jargon-filled communication and hooking you in by advertising rates that aren’t actually available for most people.

But we believe debt doesn’t have to be all bad. In fact, borrowing money can help you achieve goals like buying a car, paying for a course, or getting on the property ladder. Or even just giving you peace of mind when life doesn’t go to plan, for those unexpected emergency purchases.

We follow 5 core lending principles

As part of our commitment to being a responsible lender, we follow 5 principles. This is our promise to you, and shows what you can expect if you borrow money from Monzo (whether that’s a loan or overdraft, or other products we build in the future).

These are all based on your feedback and our user research around the most painful things about borrowing money, which we want to fix.

1. Responsible: we’ll make sure you can afford to borrow money from us

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.

This means that for eligible people who we’re confident can afford it, we can make borrowing easier and more convenient. Like applying for a loan in just a few minutes and getting the money the same day, or turning on your overdraft in a couple of taps.

2. Transparent: we’re open about whether you can borrow from us, and how much it’ll cost you

We’ll let you know how much you can borrow up front, without affecting your credit score. And if you can’t borrow from us, we’ll explain why wherever we can. In future, we want to develop features that’ll help you become eligible (like helping you improve your credit score or build your credit history).

You’ll know the exact interest rate you’ll pay (and what that means in pounds) before you borrow.

3. Clear: we communicate in plain English

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

4. Fair: we won’t sting you with hidden fees

We’ll always be upfront about what borrowing will cost you in pounds, and as a percentage. We’ll help you make extra loan repayments or pay your overdraft fees early, in the app. And if we do charge fees, we’ll always make it clear what we’re charging you for, and explain why.

5. Compassionate: we’re here 24/7 if you want to chat to us

We want to make sure anyone who borrows money from us feels comfortable getting in touch any time, and especially if something’s wrong (whether that’s losing a job, struggling with mental health, or something totally different).

We know that life can be unpredictable, and things change, so we’ve got a team of people dedicated to giving you personalised support. 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.

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 below.


I think you’ve forgotten to include the link to the blog post :sweat_smile:

Too quick! Fixed :grinning:

Haha thank you :smiley:

I have a question :raised_hand:

How far are you through making an offer to everyone on how much you can lend them? Or have you finished now?


Why am I (and I’ve seen others say this too) eligible for a £1,000 overdraft but can’t even get a £200 loan? Some people have this vice-versa as well.


I think you should create a credit card and match features that Apple have integrated into theirs with Goldman Sachs :wink:

On the side of @Ordog’s question, does being eligible mean that someone will get the loan/overdraft if they apply?

I would assume that not, as a hard check would take place when one proceeds with the application. (Apologies if this has been answered already in another thread)

A few of us have been waiting to see if we are offered loans as we want to pay off debts. Currently we are overpaying massively to try and get those paid down as soon as possible but by doing that are we less likely to be eligible for a loan as our outgoings look so high?


I have to echo what @Rat_au_van has said. Paying high rates on credit cards but would love a loan from monzo to pay less interest and smaller amounts every month, plus it would consolidate my debt.

I am yet to be offered a loan and I’d imagine this is because I have existing credit card debt which I would use the loan to pay off, the repayments would be less than what I am paying currently each month and I’m fairly sure you can see that too :man_shrugging:

Just a monzo customer holding out some hope that a loan offer will come along soon to cover my credit cards.


That’s made me think something else

My credit report would show a high credit utilisation because of these existing debts. Those would all be paid off by a loan so is that taken into account or is it solely the report as it stands now?

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Exactly! And some will pay off a chunk of their credit card and then lower the limit to curb the spending, meaning they will be constantly using 100% of their credit.

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Let’s say you have a credit card with a £5K limit and you’re at £4.9K constantly (despite regular payments each month that are equal to, or above the minimal payment required); your credit report will state you have good repayment history, but bad cashflow (income-to-debt-ratio)

Pay off that credit card with a loan and the bad cashflow is essentially ‘gone’, but you also have to both keep up the loan repayments to retain a good credit rating (which happens over time) and never use the credit card again to rack up further debt. If you do, you’ll have double-bad-debt

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Just like what @Ordog said…

Ive been offered a £12,000 loan but I’m not eligible for an overdraft due to not having enough account history? Seems very backwards to me.

Please can you pass this suggestion on to management. I know how much Monzo try’s to engage with the community and I think my idea could greatly enhance that ethos. Here is the link https://affordablecreditchallenge.com/
My idea is for Monzo to offer Round Up Loans of only one amount,the amount being £1000 no other amount and the customer pays back a fixed amount of £1200 that can be paid at there leisure over a period of time which could be 6 months to 3-4yrs. The way they pay back is through Round Ups only and if they wish overpayments options of £5-£10-£15-£20 or an amount of there choice. It is very similar to my roundups on my Monzo account that goes to MoneyBox. I would suggest that each customer MUST NOT have an overdraft facility with there bank and must prove to Monzo that is the case. My other suggestion would be a Recent utility bill and that they have a regular amount paid into there bank account. Of course people will default and if they do default Monzo will not pay any outside agency to recoup the debt,but I am absolutely certain that it will be an amazing success. I would imagine the great minds at Monzo could improve on my suggestion. I would love some feedback wether it be positive or negative. Kind Regards Brian

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Is there any info on which scoring system Monzo use? My score is fairly solid one most main scoring sites but there’s one which thinks I’m a Career Criminal (Credit Karma) so it’s absolutely abysmal.

Monzo report to Transunion so you can check your score on www.creditkarma.co.uk (formally Noddle) :slight_smile:

I was offered a Loan but this suddenly disappeared from the app and now says “not eligible” Nothing about my credit score changed and Credit Karma shows me a good score - can’t understand how Monzo make these decisions?