Monzo launches investment feature – How does it work?

4 min Read Published: 13 Sep 2023

Monzo Investments reviewMonzo, one of the UK's biggest digital banks has launched a feature allowing customers to invest from as little as £1 via their smartphone. Existing Monzo customers can access the 'Monzo Investments' feature by joining the waitlist, with the option of investing via a Stocks and Shares ISA and/or General Investment Account. In this article, we explain how Monzo Investments works, the investment choices on offer and how much it costs.

What is Monzo Investments?

Monzo Investments is a new investment feature, open to Monzo customers, via the smartphone app. Customers can choose between 3 ready-made investment options, based on the level of risk they are comfortable taking. The funds are managed by BlackRock and Monzo charges a platform fee, on top of the underlying fund management charge, ranging from 0.35%-0.45% depending on the type of account you hold with Monzo.

Speaking about the launch, TS Ansil, CEO of Monzo said "I’m so excited to get this product into the hands of customers, at a time we know they want to invest in longer-term financial goals but don’t know where to turn or how to get started. With Monzo, they now have investment expertise at their fingertips, can invest as little as £1 and track progress alongside their saving, spending, and borrowing in the Monzo app"

Monzo Investments features

  • Low initial investment requirement - Invest from as little as £1
  • Invest via a Stocks and Shares ISA and/or General Investment account - You can also choose to transfer an existing cash or Stocks and Shares ISA
  • Choice of 3 ready-made investment funds - Choose your preferred risk level. Fund choices include 'Careful', 'Balanced' or Adventurous'
  • Regular investing - Regularly drip money into your chosen fund to automate the investment process
  • Invest in companies that are 30% less carbon-intensive - All funds invest in companies that are less carbon-intensive (When compared to similar funds which don't consider carbon emissions when investing)
  • Learn more about investing - Monzo provides a number of 'jargon-free' investing topics that are free to view via the app

Investing with Monzo

Monzo customers can choose to invest in a Stocks and Shares ISA and/or a General Investment Account. Monzo also allows customers to transfer existing Cash and/or Stocks and Shares ISAs to Monzo. In terms of investment choice, Monzo currently offers three ready-made investment funds of varying risk levels. The funds are as follows:

Monzo Investments fund choice

  • Careful - Aimed at investors with a lower risk appetite. Around 80% of the money is invested in bonds with around 20% invested in shares.
  • Balanced - Aimed at investors with a moderate risk appetite. Around 34% of the money is invested in bonds with approximately 66% invested in shares.
  • Adventurous - Aimed at investors who are comfortable taking a larger amount of risk in return for the potential for higher returns. 100% of the money in this fund is invested in shares.

How much does Monzo Investments cost?

Monzo doesn't charge a monthly subscription fee to invest, unlike apps such as Moneybox and Plum which charge a monthly fee to access certain investment options and features. It isn't completely fee-free, however, as like other investment platforms and apps you will need to pay platform fees which in Monzo's case range between 0.35% and 0.45% of the value of your portfolio each year, alongside fund fees of 0.14% a year. The fees accrue daily and are charged monthly. We provide a more detailed explanation of Monzo Investment fees via the table below.

Platform Fees (per year) Fund Fees (per year) Cost of investing £1,000 - Monzo Free* Cost of investing £1,000 - Monzo Plus / Monzo Premium*
Monzo Investments 'Careful' fund Monzo Free - 0.45%

Monzo Plus - 0.35%

Monzo Premium - 0.35%

0.14% 48p per month or £5.76 per year 40p per month or £4.80 per year
Monzo Investments 'Balanced' fund Monzo Free - 0.45%

Monzo Plus - 0.35%

Monzo Premium - 0.35%

0.14% 48p per month or £5.76 per year 40p per month or £4.80 per year
Monzo Investments 'Adventurous' fund Monzo Free - 0.45%

Monzo Plus - 0.35%

Monzo Premium - 0.35%

0.14% 48p per month or £5.76 per year 40p per month or £4.80 per year

*Costs assume no growth and no withdrawals and are as quoted on the Monzo website

Is it safe to Invest with Monzo?

As with all investing, the value of your investments could go down as well as up and as such, there is a risk that you could get back less than you put in. If you are new to investing then it would be wise to read our article 'A beginner's guide to investing'.

Monzo is fully regulated by the FCA and investors are covered up to £85,000 per person via the Financial Services Compensation Scheme (FSCS). Customers also have the right to complain to the Financial Ombudsman Service if they are unhappy with how Monzo handles any issues raised. The Monzo app has a number of features that help to keep your account safe including magic links sent by email and additional biometric security features such as face ID and fingerprint scanning.

What are the alternatives to Monzo Investments?

Those new to investing, particularly those interested in investing via an app may wish to consider the alternatives before opting to invest with Monzo. Check out our article, 'Best investment apps in the UK – how to invest from your mobile', where we compare the top investing apps in the UK including Moneybox, Freetrade, Plum and Dodl.

How do I sign up and access Monzo Investments?

Those wishing to invest with Monzo will need to click and apply to join the waitlist. Alternatively, Monzo has sent an email to all eligible users who can sign up via the link provided in the email. The link displays a page that invites customers to scan a QR code, enabling them to access the waitlist via their Monzo app. Those who have joined the waitlist will then be invited to create their investment pot. Once created, customers will be guided through a number of on-screen prompts within the app, where they will learn about their investment options, before being invited to choose the investment that best suits their investment goals and attitude to risk. The final part of the process is to choose the initial investment amount and whether they wish to set up a regular payment.