Monzo launches packaged account with £15/mth fee – but is it worth it?
App-based bank Monzo has launched a packaged account – 'Monzo Premium' – with a £15 monthly fee. It offers new features including travel and mobile phone insurance and a metal card – but is it worth it?
Monzo previously offered insurance as part of its original Monzo Plus service, but this was scrapped in September 2019 following poor customer feedback. Monzo Plus was then relaunched in July this year, with features such as interest on credit balances, virtual cards and custom budgeting categories. It's available for a £5 monthly fee.
Monzo's new premium account comes with all the features of Monzo Plus, but adds worldwide travel insurance and mobile phone cover. But at £15 a month, its appeal is limited for most – those looking for insurance can get similar cover for less elsewhere, while those looking for budgeting and other features can get them more cheaply with Monzo Plus.
What does Monzo Premium offer and is it worth it?
Many will like what's on offer with Monzo Premium, and it'll suit some people, but you can match its main features elsewhere at a lower cost. For your £15/month fee, you get...
- Travel insurance. This allows multiple trips worldwide and includes winter sports cover. It covers you and your partner, as well as children 19 and under (or 21 and under if in full-time education and unmarried), providing they live at the same address.
It covers you for cancellations if you or a close relative falls ill with coronavirus before you travel, and for medical treatment if you fall ill with coronavirus while you're away.
Overall, the policy offers a good level of cover, but you can get similar insurance separately or with other packaged accounts for a lower price. For example, Nationwide's FlexPlus account also offers worldwide travel insurance, along with mobile insurance and car breakdown cover, for £13/mth. See our Cheap Travel Insurance guide for our current top picks.
- Mobile phone insurance. This covers loss, theft and accidental damage (including cracked screens), with a £75 excess per claim – but only for the account holder. For comparison, the mobile insurance with Nationwide's FlexPlus covers the account holder AND their partner and children living at the same address, with a £50-£125 excess.
Or you can buy standalone policies which may work out cheaper if it's the only insurance you want – see our Mobile Phone Insurance guide.
- 1.5% AER interest on up to £2,000. This is a boost from the 1% you get on Monzo Plus. For comparison, the top easy-access savings account at the moment, from Coventry Building Society, pays 0.96% AER on £1 to £250,000 (though it has withdrawal restrictions). Or fee-free bank accounts pay up to 2.02% on £1,000.
While Monzo Premium comes with all the features you get with Monzo Plus, a couple are improved:
- Increased fee-free ATM withdrawal limits while abroad. You'll be able to withdraw £600 from ATMs each month while abroad (Monzo's standard allowance is £200/mth or £400/mth with Monzo Plus). However, this still doesn't match our top-pick overseas debit card from Starling, which offers unlimited fee-free spending and withdrawals worldwide as part of its free account.
- The ability to view different bank and credit card accounts within the Monzo app. This is an 'Open Banking' feature, and you can add accounts from most major providers, including American Express. Some other banks, such as Lloyds and Barclays, also offer the ability for you to see bank account and credit card info from other providers in their apps.
- Monthly credit score updates. These give you your credit score from TransUnion. However, you can get your TransUnion credit score and credit report for free elsewhere. We have full details of how to check your credit reports for free, including through MSE's own Credit Club.
- Up to five virtual cards. This security feature allows you to create virtual cards, each with unique details, so you can buy online without using your real card's info. These are available with other fintechs, but tend to come with a cost, or on other accounts that have a monthly fee.
- More budgeting features including custom categories. When it relaunched its Plus account, Monzo said this was the number one feature requested by its users. Many apps, including some from high street banks, now automatically sort your spending into categories (and let you re-categorise spending), but few have the ability to add your own custom categories.
- Offers and discounts. These include 15% off Patch plant orders over £50, and 25% off Fiit home workout membership. Some of these discounts are available online or from other companies.
- A metal card. As pictured above; Monzo Plus comes with a holographic blue plastic card.
For Monzo fans who love its tech, this new premium account could be a good way to get budgeting features and some insurance cover all in one place. Plus, Monzo topped the latest official banking service poll, with 86% of its customers who responded saying they were likely to recommend its service.
Yet at £15/mth, it's not the cheapest, so you'll have to weigh up if it's worth it to you – if it's insurance you're after, you could be better off with a different packaged account that includes car breakdown and family mobile cover. Or if you don't care about the insurance, Monzo Plus has most of the other features of Monzo Premium at a lower price.
Still want Monzo Premium? Some key info
If you do think it's worth it, you can open a Monzo Premium account from today (Tuesday 20 October). But beware – if you sign up and order a metal card, you'll be charged a £50 fee if you then cancel within the first six months (there's no fee to cancel if you've had the account six months, or if you haven't ordered a metal card).
If you already have a Monzo account, you'll need to upgrade it if you want Monzo Premium – you can't have both. However, you can't upgrade a joint account as the premium account is currently only available as an individual account.