Pot as overdraft


Yes so it’s good that we’re here to share our constructive concerns / opinions :slight_smile:


Indeed, thank you for an interesting and amicable lunchtime debate :slightly_smiling_face:

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I agree, swapping money between pots and my main account is just annoying and the exact type of thing high street banks would do and the exact type of thing that Monzo should not be doing.

I use pots simply as a reference as to what my money is saved for, e.g. £100 in a pot for a rainy day fund and £500 in my holiday pot, I could transfer money to my main account the day my main balance goes below -£20 (and not pay an overdraft fee), then transfer it back to the pot(s) a few days later (e.g when I get paid), but to be honest that’s going to make me not want to use pots, I’d rather just leave the £600 in my main account instead of transferring it in and out all the time.

I’ve been trialling Monzo and Starling, and with Monzo 2.0 they have just edged the advantage over Starling, but for me this is one area that Starling are beating the high street banks but Monzo aren’t.

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My default expectation would be that Pots would offset overdraft but as I don’t manage my money that way, it’s a purely theoretical discussion for me.

I’m also pretty sure that it wouldn’t be too hard to illustrate, particularly on the pulse graph which is the only place we traditionally have any sort of running balance display.

Can I maybe recommend actually spicing up the pots a bit. Edit only currently allows a name change but why not give users the ability to set a buffer from a pot?

Say I’m heart bent on not touching my savings and I have 2k in my pot, can I not just set a 200 buffer from it? Meaning that if my current account is to go to lets say -90, it will take my savings to 1910 and set my buffer limit to 110, if my buffer hits 0 then my current account will use my overdraft?

It sounds like a good compromise, rather than leaving us with this illogical situation where we have to pay Monzo despite them actually owing us money, simply because they have our money in their other pocket…


I would say move it out of you pot and earn something on it elsewhere. Yes I know integrations are coming, but they are not here yet.

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A very good point. :sweat_smile: well if you were to reduce that sum to around £200 in a pot and a £50 buffer. It could still be a step in the right direction, compared to where it’s at now anyway.


Rather than paying for an overdraft. I would like the ability to put some money in a pot and label that pot as my overdraft.

It would need to behave slightly differently to normal pots;
If account balance is less than 0 immediately move debit amount from overdraft pot into account.

This effect could also be achieved if a balance look up was added to IFTTT

Someone has been working on this in the below topic. You might want to show your support in there to encourage him to finish it :slight_smile:

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Ah thanks! I had tried to search to figure out if it had been suggested before but clearly I was using slightly different terminology.

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I was just about to create a new thread for this, but then I found this one! And I’d even voted for it. (Well done, past me).

I’d like a fall back pot - one that I could flag as a virtual overdraft. So, when my balance goes below zero, money is taken from that pot. I think I’d quite like the pot to show a bit like an overdraft in the app too (for the psychological aspect of seeing a negative figure) but open to ideas on that.

I think this would work quite well with the functionality to top up a pot to ensure that it has £x on it, rather than to top up by Y (e.g. On payday make sure my fall back pot has £250 in it, meaning you’d add whatever amount to the pot to make it £250). Off now to see if I can find that idea anywhere :stuck_out_tongue_winking_eye:

Perhaps this may be more achievable now that the protocol is in place to support bill pots.

I think the discussion on here is interesting because the argument seems to that it is confusing to offset the pots but if you make a new single pot called overdraft it is really simple.

Monzo can add ‘virtual’ balance to that pot (authorised overdraft) or you can add real value if you want an interest free one.

The overdraft on the main account is then based on the balance of that pot, simple.

I know someone will probably claim it isn’t but as someone who works in software development it is bound to be technically possible it is normally just dependent how how much they want the function.

I’ve upvoted your post and (accidentally) started my own as I didn’t see it till afterwards but sounds like I should investigate Starling as an alternative.


I suspect monzo are focused on developing tools that empower the user to better manage their finances (as that’s good for PR). An overdraft pot sounds great on the surface, but launching a feature like that could be seen as encouraging spending of money you don’t have. I think other features like bill pots, salary sorting, virtual cards from pots, flex for larger purchases; all work to avoid being in a situation where going into an overdraft is necessary.

What spending are you worried will push you into your overdraft? If its a bill, those can already be set to come from a pot using bill pots. If its another type of small spend then you could use a virtual card with monzo plus and have that come out of a pot. If its a larger one-off purchase, then flex could be used to soften the blow.

Surely not? Unless I’ve misunderstood, what folk are after are effectively off-set pots: so you save your own money then can dip into that (for 0% interest) when you’re overdrawn rather than paying for the privilege.

I think it would be a very sensible addition to the money management features. Probably end up hidden behind the Plus/Premium paywall, though.


I don’t disagree that it would be a useful feature. I’m just speculating about reasons why it hasn’t been implemented. Promoting a pseudo-overdraft might be challenging. Maybe it could work if the term overdraft wasn’t used at all and instead you were just given the option to nominate a pot as a “back up” pot.

I just think with all of the other tools available it’s now arguably more difficult to go in to your overdraft. Most of my spending already comes out of pots and those pots have more than enough in them so they technically have built in “overdraft”.

I feel like having a feature that checks the account balance, if that isn’t high enough then it checks the overdraft pot balance and transfers the require amount if available or otherwise rejects the transaction; all feels like too many checks and processes that would all have to happen prior to the transaction being authorised.

I’m just trying to play devil’s advocate and understand what type of transactions are still likely to cause people to go into their overdraft and where the gaps are in the current feature-set.

So for me this is just about the temporary situation where I’ve forgotten to transfer before I shop. Like when you get to the till and you are £10 over what you expected.

It is annoying to have to scrabble for the app in such situations but that is what an overdraft is for; covering temporary issues. You might use it if you have to put down a deposit you are getting back shortly or something like that.

In short, we are discussing the exact opposite. If the money is my money and I’m effectively borrowing from my own pot then it helps teach us not to rely on Monzo’s cash. Everything about these suggestions is about preventing people from getting hooked on debt.

If you run out of money in your overdraft Pot, don’t enable a real overdraft them nothing has changed at all.

There are only benefits really. Of course many will not want it but potentially many others will. Features shouldn’t need to be universally wanted to make them worthwhile. I’d be happy to help with developing and testing such functionality.

Ultimately though it sounds like it already exists and Monzo are changing for it. Sounds like it is basically the virtual card?

It is hard to accept arguments about improving the financial world when you are basically saying that basic functionality costs £5 a month. But then I guess some believe banking should not be free anyway?

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Not exactly…

Virtual cards can be connected to a pot. So in your argument, you could have a groceries pot and pay with your groceries virtual card to have the money come straight from there. You can only have 5 virtual cards at a time though.

After this you’ve really lost me though. You argue that it’s better for planning your money and such but then you used an example where you didn’t plan your money and spent over which would happen regardless of your “custom overdraft” or the “normal overdraft”.

I also don’t understand this part either if you wouldn’t mind elaborating. What is basic functionality that is £5 per month? Or are you saying that your custom overdraft should be classed as basic functionality?

I don’t mind the idea and I can certainly see plenty of pros and cons. There is not “only benefits”. For me personally I like having my “emergency pot” separate and hidden. So I only dip into it in a real emergency, not because I bought some Haribo from the supermarket on impulse and overspent on my groceries budget.


Why would you need to transfer before you shop? Do you keep account balance zero and move money prior to shopping? Personally I move nearly all of my money into pots on payday leaving behind an amount that more than covers my monthly food spend. If I’m at a store about to buy something other than food, it’s usually something I’ve planned to purchase that day and I’d have moved money from a pot prior to driving to the store.

I guess I’m fortunate enough to not have to worry about running out of money each month. But if you regularly run low on funds, surely topping up your bill pots with a buffer achieves exactly the same thing as having an overdraft pot. In both cases you’re using your own money to create a safety net.

Again, I do see the appeal of this feature, I asked for it myself 2 years ago in this thread. I just think with the current feature set of Monzo; overdrafts generally feel much less useful. Like I said before, maybe it’s just a terminology thing. Checking a box that says “use this pot if I run out of money in my main account” does sound great. I’m just not convinced it’s needed anymore given the other features that monzo has.

So I confess some of my last reply wasn’t perfect, I noticed some typos on rereading so my apologies for that.

So regarding the idea of an overdraft where you use your own money, yes I do think it should be standard functionality but I’m saying it should be in my opinion for all banks not just Monzo. It’s an opinion so I accept you may disagree.

Regarding the budgeting point I’m not saying it’s bad budgeting or even technically over budget; I’m saying there are times when I haven’t got round to transferring it before the till. This is for logistical reasons normally but mostly it is linked to unexpected lack of internet which is more common than you might think in rural England.

Virtual cards do sound slightly different but it still sounds like the basic principle is similar. I think I was just saying that offering one virtual card for free would pretty much cover what is being discussed. Although do they work without the internet?

Anyway, I’m going on too much so I’ll stop; personally I’d like to see the functionality.

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