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That bans fixed fees - (e.g. you get charged £1 a day when in overdraft) Monzo has never had fixed overdraft fees, and can still charge a daily % interest rate
by shawabawa3 7y ago
That bans fixed fees - (e.g. you get charged £1 a day when in overdraft)
Monzo has never had fixed overdraft fees, and can still charge a daily % interest rate as usual
Overdraft fees are also not their "one source of income"
- benj111 7y agoRead the GPs link "A 50p charge every day your account is overdrawn by more than £20, up to a maximum charge of £15.50 a month. No other fees, that’s it". That sounds like a 50p a day fixed fee to me. They can still charge a percentage, but that 50p per day (£15.50/ month)is £186pa on a potentially only £20 overdraft, I don't think they would get away with the equivalent APR. In the context of the conversation, one current source of income was offered, so I think its reasonable at that point to label it their one source of income, other sources have been mentioned elsewhere on the thread though.
- shawabawa3 7y agooh, my bad, I didn't realise Monzo used a fixed fee. I'm glad they have to change that, that's payday-loan level APR for small overdraft balances I was thinking of Starling's overdraft (similar UK bank) which is 15% APR with no fixed fee
- DanBC 7y agoHere's the link to the FCA press release: https://www.fca.org.uk/news/press-releases/fca-confirms-biggest-shake-up-overdraft-market https://www.fca.org.uk/news/press-releases/fca-confirms-bigg... > Stopping banks and building societies from charging higher prices for unarranged overdrafts than for arranged overdrafts. > Banning fixed fees for borrowing through an overdraft – calling an end to fixed daily or monthly charges, and fees for having an overdraft facility. > Requiring banks and building societies to price overdrafts by a simple annual interest rate.