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I do think sometimes on here people defend Monzo for things that they certainly would heavily criticise a legacy bank for doing! I do find that this is something that on the surface seems very unfair.
So I completely understand not including money held in a ‘savings account’ of some kind doesn’t count (especially in the case of Monzo where their savings pots are not even held by them but by an external bank) BUT the standard ‘non savings’ pots are simply a segregation of the main bank account. They are interest free. On a moral level it is certainly very fair to say ‘what on earth is monzo charging you for here’? Because essentially the money being lent is your own money sat in your pot that is earning zero interest for you.
As for the “oh just set up an overdraft buffer pot” well… no. Because that’s firstly a clunky fix and secondly, it only includes the money in that one pot. It doesn’t solve the problem at all, it just gives you a ‘free overdraft’ up to the value of whatever you set aside in that pot… but in that case, why not just have that money in your account and not go below it? answer: because it’s not that easy. If it was that easy to avoid your overdraft, no one would need one!
Putting myself in Monzo’s shoes for a second though, there’s are 2 valid reasons I can think for Monzo doing this:
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To avoid you undermining your savings by living in your overdraft - the problem with free overdrafts is that people often tend to ‘live in them’ - you give someone their money back for free. and they spend it and every month you end up at the bottom of your free overdraft. and then to make matters worse, you also spend the money in your pots, and then boom. You are now in your overdraft AND paying fees.
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To avoid confusion between savings pots and regular pots - as I mentioned before there’s a valid reason you can’t do this with savings, because savings pots are very much a separate account. Therefore it would be confusing to say ‘your overdraft includes your pots but not your savings pots’… its a confusing message.
(And also, obviously, the 3rd reason being that overdrafts makes Monzo money. Which is a valid reason, but it’s certainly not beyond criticism!)
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That’s just a very long winded version of everthing that has already been said in this discussion. Not sure what you’re trying to say or why I’m being quoted 
You’ve even misunderstood what I was saying because you’ve taken it out if context.
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There was a time when Monzo was wrong about pots and overdrafts but that was when they hadn’t worded their terms and conditions correctly. That was rectified a year or so ago.
Pots are essentially ‘savings accounts’ so are separate to the main ‘current account’. Monzo just fails to be clear about this, maintaining a link they are part of the current account. This is where the confusion lies. Monzo should now just give pots account numbers and sort codes to stop all this confusion about pots and overdrafts.
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They are not. It’s a segregation. Other providers have separate savings accounts which are entirely different products with their own terms etc. Monzo’s current account and pots are one account with no separation, just segregation.
As much as Monzo wants to make it look like separate accounts and is selling that to us consumers, it’s not what’s happening and I’m extremely surprised this hasn’t been changed yet as it’s very unethical.
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Most of the stuff I said hadn’t been mentioned? Not in this thread at least… I quoted because I directly replied to your comment about the overdraft buffer pot and also because I thought saying “I think you’re misunderstanding what pots are intended for” was a bit defensive… and then I went on to say why I thought OPs point was a valid one in some respects.
I do just worry a bit when people come on this forum with a valid concern and instead of getting a balanced discussion, they get a “your holding it wrong” kind of response
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Yes totally agree with this, but as you say it does need to be made more clear and explicit that this is now separate and not just a segregation of the main account
Not sure why people would opt into using pots and overdrafts and then complain about the way they work. This subject has been done to death, it’s not as if the system has suddenly changed for the worse.
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The buffer pot was just a suggestion of something to keep an eye on… jeeez 
It might be helpful, it might not 
That’s for the OP to decide, not you.
The comment wasn’t intended to be offensive either. The OP thankfully didn’t seem to take it that way, so I’m not sure why you’re arguing on their behalf 
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I don’t think this solution makes sense because having auto withdrawal from pots is equivalent to just having all pots money in the main account. The notification when you go into your overdraft seems sufficient to let users know they should move funds into their main account.
I do believe that Monzo should take the money in non-savings pots into account though then have a place in the app where it is possible to view your “Overdraft Balance”, which shows the total balance of non-savings pots + main account excluding unsettled transactions.
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I think Monzo are potentially skating on thin ice given that the pots (bar those with 3rd parties) are all in the same account.
In particular, Monzo could well be breaching the FCA’s Treating Customers Fairly principles especially given the apparent lack of understanding from many over how their overdraft charges work.
Other banks simply have a right to offset balances between accounts to move funds to avoid their customers building up overdraft charges.
This is going to be a bigger issue going forward given the 40% overdrafts and Monzo’s removal of their interest free buffer on accounts.
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From the account terms and conditions
From the overdraft credit agreement
From in app help document
And then there are push notifications
The only way you could miss this is if you decide not to read anything
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Seems to me that the point @gt94sss2 is making (and makes sense to me) is that just because Monzo state that’s what they do doesn’t make it right or compliant with FCA rules.
FCA rules in this instance exist to keep things fair because like it not most people read terms and conditions.
My personal opinion is it’s just a money grab from Monzo but then again I don’t have an overdraft and never would so doesn’t affect me
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Sure it’s in the T&Cs and there are help articles but I still don’t think that it’s fair. I have agreed to it but that doesn’t mean I have to like it.
Yes Pots are where people have ring-fenced money from their main balance but they are not ring-fenced from the account, the amounts put aside in those pots still make up part of the account balance. They are a part of my Personal Account, they even sit within the account they belong to in app.
I believe that overdraft charges should only be applied if the account as a whole is in a negative balance, and not just one part of it.
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Very true, which is why there are also push notifications
Terms and conditions I can see people ignoring (I often do if they go on for pages) but to not at least skim read a credit agreement that you need to have confirmed you’ve read?
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I’m afraid you have missed the point.
The FCA rules supersede any terms and conditions that Monzo may include.
And part of the reasons for their rules are precisely that most customers never read the T&C or help pages and even if they did, cannot be expected to remember how Monzo’s ‘unique’ method of overdrafts works.
Neither is sending a notification any guarantee that a customer will see it in a timely fashion.
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My Issues is with a degradation of usability if you only paid for overdraft on account + regular pots going into negative.
It would be super confusing in app if you had say 500 quid in a pot, and were in your overdraft by 480 quid and not paying anything then pay another 40 and go into effectively a second overdraft. How does this make any sense to a user? How is it clear when I get into my ‘real’ overdraft? Would you just automatically take money from pots if you went below 0 in your main account? that seems even worse.
Can’t think of a nice non confusing alternative to not paying overdraft on money in pots. How does Starling do this? Is it clear?
I think it’s especially confusing since some pots would count towards overdraft and others wouldn’t.
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Maybe not but the FCA have said all banks must do this for overdrafts, so they must think this covers treating customers fairly
It’s one thing that banks need to do - it doesn’t mean it, by itself, meets the requirements for treating customers fairly - they are much broader in scope and remit.
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As you’ve said, you yourself don’t always read the T&C - why would you expect someone to read or skim read them for an overdraft.
After all, everyone knows how they work, no? You go overdrawn and pay some interest. Who is going to read the stuff about balances in pots being excluded - which you would probably miss even if you skim read the small print or even if you read it fully.
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