Thursday, May 23, 2024
CFM1100x220
DigitalSelect1100x220
MediaXO.1100x220
MT2.1100x220

Monzo Business Account Review

Established in 2015, Monzo secured a UK banking license in 2017, marking the inception of their personal banking services. The following year, they expanded their offerings to include products tailored for businesses to enable them to offer both personal and business accounts. Within just six months of this launch, they reported acquiring over 50,000 business customers. This Monzo business review will explore the prominent features of their business-focused product.

Monzo Business Pros & Cons

Pros:

  • Monzo app is simple to use and has many features that save time
  • Monzo is fully licensed UK bank so deposits in bank accounts are protected up to £85,000 per business under the FSCS.
  • Great for sole traders and smaller business owners who can fully utilise the functions that make accounting easier.

Cons:

  • Monzo is a digital bank and has no branches, so any cash needs to be paid in via Paypoint, which incurs a cost – so if your business deals with a lot of cash then Monzo may not be the best option.
  • You can only access the more complex functions if you subscribe to the paid Pro account tier.
  • Monzo currently does not allow certain types of business to open an account, so it is best to check whether your business is eligible before downloading the app.
  • Monzo is currently only open to users within the UK.

What Is Monzo?

The Monzo business bank account provides a smartphone app-centric banking experience, offering a range of features aimed at simplifying business banking and enhancing cost transparency. While the Monzo personal account predominantly operates through the app, the business account allows users to conduct banking activities via their website on a computer, catering to those who prefer desktop banking.

Primarily designed for sole traders and small to medium businesses, the product may not be as suitable for larger enterprises already equipped with established processes that render features like Tax Pots or Invoicing unnecessary.

Monzo imposes stringent eligibility criteria for opening a business account, with restrictions on certain business sectors and types of incorporated businesses. For a detailed list of eligible businesses, refer to Monzo’s signup requirements.

Monzo Business Features

  • Tax Pots – set a percentage of revenue aside for tax
  • Integrated Accounting Software – includes Xero, Quickbooks, Freeagent and more
  • Multi-User Access – multi-user access for their staff (Limited companies only)
  • Invoices – generate directly from your Monzo account
  • Mobile & Web Access
  • Currency Transfers – via Wise at low rates

The Monzo business account is available in 2 tiers – Lite and Pro. Both these account tiers have the following elements.

  • UK bank account
  • Debit card
  • Instant Notifications
  • Savings Pots
  • Free UK transfers
  • Budgeting and spending categorising
  • Mobile & web access
  • Business Debit card
  • Fee free spending abroad

Then the below features are only available on the Pro (paid) account:

  • Tax Pots
  • Integrated Accounting
  • Multi-user Access Invoicing

Signup with Monzo Business

Who Is Monzo Business For?

In today’s business landscape, a significant portion of operations occurs exclusively online. From marketing and sales to communication with customers, suppliers, and staff, nearly every function operates in the digital realm, with much of the interaction taking place via mobile devices.

Given this digital shift, it’s logical that banking can also be conducted in this manner. While all banks, including traditional high street institutions like Lloyds and Barclays, have entered the online space, some have faced challenges due to their extensive internal procedures and legacy systems, which must be navigated to implement new technology for customer access.

In contrast, challenger fintech banks like Monzo, alongside competitors such as Starling Bank, Revolut, and Tide, do not face these legacy issues. Having built their platforms in recent years, they leverage cutting-edge technology without the burden of outdated systems that can hinder user experience.

As a result, it’s not surprising that these new app-focused banks often offer a smoother user experience compared to many traditional high street banks.

Monzo and similar app-focused banks appear to target smaller businesses, as larger enterprises typically have dedicated bookkeeping or accounting staff who manage many of the processes that these banks streamline.

It’s worth noting that Monzo operates as a branchless bank, meaning cash deposits can only be made via Paypoint locations, with associated charges and relatively low deposit limits. Consequently, businesses that deal extensively in cash may find that Monzo is not the most suitable option for their banking needs.

Monzo Business Costs & Fees

There are 2 account tiers for Monzo business:

  • Lite – Free
  • Pro – £5 per month

In addition to the above, there are various costs for functions within the account:

  • Paying in cash: Customers can pay in cash to their Monzo account at any Paypoint location. Monzo charge £1 for each cash payment. Each business can only pay in a maximum of £1000 every 6 months.
  • ATM withdrawals: Up to £200 in cash per calendar month can be withdrawn. Above that amount, Monzo charge 3% of the amount withdrawn.

Is Monzo Business Safe?

For each business with an account with Monzo, their deposits are covered up to £85,000 under the UK’s Financial Services Compensation Scheme (FSCS).

Monzo Business Alternatives

Tide

Starling Bank

Wise

Monzo Business FAQ

CAN YOU PAY CASH INTO MONZO BUSINESS?

It is possible to pay cash into your Monzo Business account via all PayPoint locations. However, it costs £1 per desposit, and businesses can only pay a maximum of £1000 into their account in every 6 month period. Therefore, if you business deals with a lot of cash, then it may be better to look at other business account options.

ARE MONZO BUSINESS ACCOUNTS FREE?

Monzo Business does have a free business current account. However, to get all of the useful features such as tax pots, integrated accounting apps and invoicing, you will need to subscribe to Monzo Business Pro, which costs £5 per month.

Monzo Verdict

The Monzo business account offers a modern, efficient solution for businesses to manage their banking, that could significantly save time, especially for sole traders and small businesses.

Signup with Monzo Business

*Please note: This article may include affiliate links. If you purchase through these links, we may earn a commission at no extra cost to you. This helps support our work and allows us to continue providing content like this.

Subscribe to our newsletter

To be updated with all the latest news, offers and special announcements.

MobileArts600x500
24 Seven 600x500
SeriouslyFresh 600x500
WT51%
Evina 900x750