Of course you are. I assume that, that comment was disingenuous though & I don’t really want to spend my time answering questions that you already know the answer to.
Comments like that really aren’t helpful. As you know, the purpose of this community is to discuss & critique what Monzo’s doing. Let’s get back to discussing the overdrafts pricing please.
It sounds like you believe that your conclusion is the only one that could possibly be right. But the reason why we’re discussing this is to share different viewpoints 
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I wonder how much it would cost if they had an optional monthly charge for a “total equal” system:
- 2% ATM fee
- reduced charge overdraft
- interest on your account
Etc
Could you spell those advantages out because apart from a instant awareness of how much people have until payday I cannot see it.
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But someone has to pay for Monzo to keep their lights on. The only way you can get “free” accounts in the legacy banks is because they make their money through other means like card usage fees for abroad, extreme fees for stuff like rejected DD’s, etc.
At the very least Monzo doesn’t rely on hitting you with fees at the worst possible moment (usually when you start to get rejected DD’s and stuff you’re in a pretty bad situation already) and prefer to make their money by giving you an optional overpriced overdraft where you know the fees in advance.
I’m not saying Monzo’s overdraft is cheap and wouldn’t be using it regularly (again, if you use an overdraft regularly there is definitely another problem completely unrelated to the price of said overdraft), but I might dip into it occasionally and am happy to pay the price. In fact, that’s exactly why it’s priced that way, because they expect it to be used very sparingly and so would maybe get at most a few quid a month off its users.
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At the moment Android is behind on this because it doesn’t even have targets yet. When the new API is out I’ll happily write myself an app for predicting future balance based on previous transaction history to try and influence spending habits.
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Yes. I agree with this and agree that the bills need to be paid. Which is why I’m wondering how this pricing model can work.
For example you said earlier: it’s ok if you don’t use it much. But that’s not what is needed if Monzo is to be sustainable; that’s the point I’ve been trying to make.
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I’m not sure how it applies to sole developers. For larger companies doing aggregation services they need FCA approval?
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Monzo have been pretty open on how they plan to keep the lights on.
High customer base millions UK to billions worldwide
Fixed pricing overdraft fees across that base
Low cost maintenance per customer
Looking at is this way even a couple of days per customer will be a large revenue stream.
On top of affiliation fees and account aggregation/marketplace.
Like I say overdrafts are used in many different ways. If used for low amount medium term lending then it’s obviously not going to be cheap. But I don’t think that is what Monzo want to offer as a service.
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Depends on the quality of such API. I’m not sure what API features of PSD2 mandates, but I wouldn’t be surprised if the legacy bank’s APIs will be extremely limited (the bare minimum to meet this new law) or so awful that no developers will ever bother with it.
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PSD2 and the APIs if done right will be extremely interesting in an IFTTT world. Say you have a rule that if your Monzo account goes into overdraft you invoke a payment from your Barclays current account. 
I am not sure I agree exactly… in as much as people do overpay everyday for a variety of reasons. Choice is often a big reason why someone ends up overpaying (usually lack of choice).
Not having branches or cash machines everywhere must reduce costs quite a lot
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But there’s still the initial investment they need to repay - building a bank from scratch (and doing it properly) isn’t cheap.
There is an economies of scale thing though. The big banks have millions of customers and very well developed products including mortgages, credit cards and loans. They have a huge head start.
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I think it’s quite obvious that Starling are still happy to operate at a loss to attract customers (like Monzo used to do) but at some point they will have to charge some kind of fees in order to turn it around and actually have a profitable business.
There are many tech companies that are still losing money while they work on the operating model for profit. All need scale to make low cost work. Uber is a prime example.
I suspect most investors expect a loss for the company for many years as they see and have confidence in the vision and goals of Monzo.
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This is where there will be many disagreements across the user base for many various reasons. I personally don’t see it as over priced. Granted I don’t expect to use it for long periods and if I started to I would look into a better solution. Which is the environment I believe Monzo wish to create.
Others that do see it as overpriced have a choice to either not take the overdraft or not use Monzo as their main bank.
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I guess we’ll wait and see but I doubt it - something will have to pay the bills. Again, the legacy banks do it by operating the current account at a loss but makes their money back with huge unexpected fees. Starling will probably not be doing that so something will need to be “overpriced”.
However, isn’t “overpriced” a matter of opinion? They are selling you a service (a good current account), and you have to pay for it; seems perfectly fair. In this case it’s even better as you don’t even have to pay just for the current account, merely for an optional overdraft.
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