Monzo has launched a new 'premium' account that is set to rival a number of high street packaged bank accounts with additional features such as phone and travel insurance. The launch comes 3 months after the app-only bank announced losses of £114 million, a proportion of which can be attributed to the effect of the Coronavirus pandemic on businesses. In this article, we take a look at what the new Monzo Premium account offers, how much it costs and how it compares to other banks.
Monzo Premium features
- Exclusive metal card - get an exclusive metal Mastercard with Monzo Premium
- Phone insurance - with £75 excess you can protect phones up to the value of £2,000 and phone accessories up to the value of £300. Monzo Premium account phone insurance is underwritten by Assurant
- Travel insurance - with £50 excess protect your holiday with cover up to £5,000 for cancellation, £10 million for medical bills and £750 for lost items. Monzo Premium account travel insurance is underwritten by AXA
- Savings interest - earn up to 1.50% interest on money held in your current account and in your regular pots
- Add additional accounts - add your other bank accounts and credit cards to your Monzo Premium account to see your balance and transactions all in one place
- Discounted airport lounge access - get access to over 1,000 worldwide airport lounges for you and your friends at a discounted rate
- Roundups - you can round up your spare change in the same way as a regular Monzo account, however you have the option to multiply your spare change by x2, x5 or x10.
- Check your credit score - frequently monitor your TransUnion credit score within the Monzo app
- Virtual cards - add up to 5 virtual cards to your Monzo Premium account for secure online shopping
- Rewards - get rewards and discounts with retailers such as Hello Fresh, Fiit and Babylon Health
How much does Monzo Premium cost?
A Monzo Premium account is available for customers aged between 18 - 69 years old and costs £15 a month for a minimum of 6 months. In the below comparison table we show how a Monzo Premium account compares to other Monzo accounts. For more information on Monzo and the accounts it offers, read our independent 'Monzo Review'.
A comparison between Monzo accounts
|Monzo Basic||Monzo Plus||Monzo Premium|
|Cost (per month)||FREE||£5||£15|
|Minimum term||No minimum||3 months||6 months|
|Fee free spending abroad|
|Free ATM withdrawals (every 30 days)||£200||£400||£600|
|Free Cash deposits||1||5|
|Interest (up to £2,000)||1.00%||1.50%|
|Advanced round ups|
|Airport lounge access|
How does the Monzo Premium account compare?
Monzo Premium offers features similar to other packaged accounts provided by high street and app-only banks. In the below comparison tables we see how the Monzo Premium account compares.
Monzo Premium vs High street banks
In the below comparison table we compare Monzo Premium to the Nationwide FlexPlus account and the Halifax Ultimate Reward account.
|Monzo Premium||Nationwide FlexPlus||
Halifax Ultimate Reward
|Fee-free spending abroad||
2.99% transaction fee
|Round up spending|
|Free ATM withdrawals||
£600 free every 30 days
Monzo Premium vs Revolut
In the below comparison table we compare Monzo Premium to the Revolut Metal account.
|Monzo Premium||Revolut Metal|
|Free ATM withdrawals||£600 a month||£800 a month|
|Interest||1.50% up to £2,000 on current account balance and normal pots||0.80% on money in savings vaults|
|Fee-free spending abroad|
|Round up spending|
|Airport lounge access||Discounted rates||Free for you + 3 friends (if your flight is delayed over an hour)|
Is Monzo Premium worth it?
Monzo Premium may be a good option for those who have £2,000 of savings as they could benefit from a higher interest rate. However Monzo Premium only offers 1.5% interest up to £2,000 and so the maximum return would be £3 per month. The features on offer with a Monzo Premium account are similar to those offered by other high street bank accounts but the additional roundup features and attractive interest rate may be enough to set Monzo apart. However, the lack of breakdown cover and limits on free cash withdrawals are likely to be the sticking point for some.
Monzo Premium could be seen by many as an effort to claw back some of its recent losses. Packaged accounts are a profitable source of revenue for many of its rivals and so it isn't a surprise to see Monzo entering the market with a 'Premium' product that offers more than its Basic and Plus accounts. The timing is likely to be criticised, however, with many people already struggling to pay the bills and at risk of redundancy.
In summary, those seeking a packaged account would be wise to compare the benefits on offer and to see if any of the insurance products could be bought separately and more cheaply elsewhere. It is also worth remembering that benefits change over time, as well as the monthly costs and interest rates, so what looks good value now may not be such good value in 6 or 12 months time.