@rodelliott just to add a few comments, in your opening comment you said “it’s well known in banking circles that current accounts are especially low margin” and for a legacy high street bank with branches and cash you are probably right. However, our financial success doesn’t mean we just copy what those banks do. If you take both sides of a simple balance sheet, we will have customer deposits (current accounts in credit) earning no interest. On the other side of the balance sheet we have unsecured overdrafts generating say 20-40%. I’m not sure I follow the logic that offering residential home loans at a margin of say 3% (albeit with a cost of capital about half) would offer ‘better margins’.
@alexs and @Naji have covered our position very well and that’s the difference between Monzo and the other banks! I’m happy to continue the discussion if you have more thoughts/questions. Paul