I was thinking about what would make monzo the main account for everyone and have this idea - obviously with no prior knowledge about the uk banking rules and regulations
why doesnt monzo introduce savings account that accrues high overnight interest, and to and from which you can deposit and withdraw money anytime you want.
So any money you put into the account earns you interest which you can practicaly withdraw the next morning
you can go to sleep your money shouldnt sort of thing
Anarchist
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2
Like a savings pot. But you want high interest? Or have I misunderstood?
So your account only earns interest overnight? And whatâs high? And why would Monzo want to do this?
Right now, if your money is in an interest bearing account, itâll earn money overnight. Whatâs the incentive for a bank to give you a better rate just because you are sleeping?
Confused here.
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Anarchist
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5
Let me explain further- this will be a dual account and probably the only in the market where your current acccount balance becomes your savings account balance and the interest paid in will be avaible in 24 hours
so you earn avaible to withdraw cash every evening
It is interest on your current account and ânormalâ pot balances, which is paid monthly I believe so there is no delay and you donât have to âwithdrawâ into your main balance, as it is your main balance.
Sorry I was mistaken, it is paid monthly (it could be calculated daily but that is another thing).
I think the problem with your idea is that the bank would only have circa 12 hours (probably less) to actually calculate interest - now if it were to be a âhighâ rate at that, it would from what I would guess be too much of a task to administer such a product - it also has all benefits for the customer and no benefit for the bank (apart from people keeping money in their current account - which is arguably solved by the interest on your current account with Monzo Plus)
Thats why its a product suggestion Monzo can stand out provided the banks tresuary department is happy to handle the cash over night and can make a profit and then share it with us users
Agreed but it will depend what the bank can do with that cash over night in the money market the rest is just a software add on which monzo can definetly handle by the looks of it
Iâm gonna guess this is more complicated than it sounds.
Guessing because if it wasnât, this would already be an option, so itâs either complicated to manage financially, complex to administer, or would cost banks more than itâs worth to even offer as an option??
But where are the Bank going to make 1.5-2.5% on the money in 12 hours? And how do they know how much money they have? If it is just current account balances someone could take out ÂŁ000s overnight and then Monzo would have to scramble to ensure they have the funds for that withdrawal - the money isnât locked down for Monzo to do anything with it.
Even if they could, theyâd have 12 hours to make a hefty % to ensure they arenât losing money.