Overnight interest bearing savings account

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

Like a savings pot. But you want high interest? Or have I misunderstood?

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More like your current account becomes a savings account over night and earns you an interest for the money you leave in it

they could apply a limit say anything above 2000 will earn you X much interest after 5 pm

and when you wake up the next morning the interest is part of your avaible balance

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So your account only earns interest overnight? And what’s high? And why would Monzo want to do this?

Right now, if your money is in an interest bearing account, it’ll earn money overnight. What’s the incentive for a bank to give you a better rate just because you are sleeping?

Confused here.


Like they do with Monzo Plus, but free, then?

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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

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Does monzo plus give you an overnight savings account with no fixed term deposit ?

will look into this wasnt aware

Yes it does. But it costs £6 per month, which is more than you’ll get in interest.

[quote=“Anarchist, post:8, topic:74752, full:true”]
Yes it does.

is it paid over night ? can you see your interest balance as avaible the next morning and spend it

It is interest on your current account and “normal” pot balances, which is paid monthly I believe so there is no delay and you don’t have to “withdraw” into your main balance, as it is your main balance.

EDIT: corrected time frame of interest.

So you are saying i can see say 1000 pounds go upto 1000.01 the next morning every day ?

Interest is paid monthly.

I think the OP wants interest paying daily (overnight)

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I don’t know of any account that pays interest daily?

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 “high” 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

I’m gonna guess this is more complicated than it sounds.

Guessing because if it wasn’t, this would already be an option, so it’s either complicated to manage financially, complex to administer, or would cost banks more than it’s 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 £000s overnight and then Monzo would have to scramble to ensure they have the funds for that withdrawal - the money isn’t locked down for Monzo to do anything with it.

Even if they could, they’d have 12 hours to make a hefty % to ensure they aren’t losing money.


So let me explain futher any money that hits the account before 5 pm start earning overnight interest.

Say the client has 10.000 gbp of which only 7500 gbp will earn the interest leaving a good margin for the debit card purchases or cash withdrawls

anything above that can stil be spent but will not earn the customer an interest for that evening

In terms of what the bank can do with the cash is beyond me but i assume the money can be lent to other financial instutions over night

i think this could be game changer