Monzo
| File:Monzo logo.svg | |
| Monzo | |
| Industry | Financial services |
| Founded | 2015 |
| Founder | Gary Dolman Jason Bates Jonas Huckestein Paul Rippon Tom Blomfield  |
| Headquarters | 38 Finsbury Square London EC2A 1PX, UK[1] |
Key people | Tom Blomfield, CEO Gary Hoffman (chief executive), Chairman |
| Products | Banking |
Number of employees | 1351 (2019) |
| Website | www |
Monzo Bank Ltd (/ˈmɒnzoʊ/), is a digital, mobile-only bank based in the United Kingdom.[2] Originally operating through a mobile app and a prepaid debit card, in April 2017 their UK banking licence restrictions were lifted, enabling them to offer a current account.[3] Monzo was one of the earliest of a number of new app-based challenger banks in the UK.
History
It was founded as Mondo in 2015 by Tom Blomfield, Jonas Huckestein, Jason Bates, Paul Rippon and Gary Dolman.[4][5][6][7][8] The team had met whilst working at Starling Bank. In February 2016, Mondo set the record for "quickest crowd-funding campaign in history" when it raised £1m in 96 seconds via the Crowdcube investment platform.[9][10][11]
Two weeks prior to the name change, Monzo was granted a restricted banking licence, by the Prudential Regulation Authority and the Financial Conduct Authority and as of April 2017 these restrictions have been lifted.[12][13] Monzo had a number of prepaid debit cards in operation which it issued to users for testing purposes.[14] These cards were in use until current accounts were made available to all and the prepaid programme was closed on 4 April 2018.[15]
On 16 May 2017, Monzo announced that over £250 million had been spent through its prepaid card, between 200,000 customers.[16]
Monzo is registered at Companies House under the legal name 'Monzo Bank Ltd' and initially traded as Mondo. On 13 June 2016, a company blog post announced that the "Mondo" trademark had been legally challenged by an undisclosed company with a similar name.[17][18] As a result, a naming suggestion contest was organised and the new name, "Monzo", was announced on 25 August 2016.[19]
On 17 July 2017, Monzo announced the current account preview and began inviting eligible customers to sign-up for a preview of the full current account.[20][21] Initially, customers attended events at the company's offices in London but cards have also been sent out via post. In line with the company's general stance on transparency, the Monzo website includes a live counter showing progress on the rollout.[22]
In October 2017, Monzo announced that it would be discontinuing free ATM withdrawals abroad, replacing them with a free monthly withdrawal of up to £200 and a charge of 3% on subsequent withdrawals. This change came into effect on 18 December 2017.[23]
On 7 June 2018 Monzo announced an integration with IFTTT which allowed users to connect their account to smart devices and services. For example, connecting Monzo to Amazon Alexa.[24]
During June 2018, Monzo gained significant public interest after fraud analysts with the bank spotted signs of and publicly announced a Ticketmaster data breach in April 2018, before Ticketmaster had spotted the breach themselves, and two months before Ticketmaster admitted the breach had occurred.[25][26]
On 25 June 2018, Monzo announced their team up with TransferWise to provide international money transfers from within their Monzo app.[27] Existing TransferWise customer can connect their account to use along Monzo app. It was later announced in November 2018 that interest would be paid on savings (in 'Savings Pots' above £1,000) in collaboration with Investec.[28]
In October 2018, Monzo reached one million customers, and was also named the best tech startup to work for by LinkedIn UK.[29][30]
On 21 November 2018, Monzo added the functionality for users to pay cash into their Monzo accounts using PayPoint, charging users £1 for each deposit.[31]
On 28 January 2019, Monzo announced a partnership with Flux to add itemised receipts and loyalty points.[32] In addition to this, the API to create receipts was published by Monzo.[33]
In August 2019, the company announced that it had inadvertently logged 480,000 customer personal identification numbers, making them accessible to Monzo's internal team of engineers. The issue arose because PINs were transmitted in the query string of a HTTPS request.[34][35]
Fundraising
In October 2016, Monzo announced an 'interim' funding round valuing the company at £50M and raised £4.8M in the process led by Passion Capital.[36] This round was followed by a second £2.5 million Crowdcube crowd-funding campaign with the total pledged quickly hitting the target amount.[37]
In February 2017, Monzo raised £19.5M from Thrive Capital, Passion Capital, and Orange Digital Ventures, which it intended to supplement with a crowdfunding campaign for an additional £2.5 million.[38]
On 6 November 2017, Monzo raised £71 million from several investors in a round led by Goodwater Capital. At the close of the round, Monzo was valued at £280 million.[39]
On 30 October 2018, Monzo became a pound “unicorn,” with an £85 million fundraising round valuing the company at £1 billion.
On 5 December 2018, Monzo held another £20 million Crowdcube crowdfunding campaign, reaching nearly £18 million in funding in less than three hours, and reaching the £20 million goal in just over two days.[40]
On 24 June 2019, Monzo raised £113 million in a Series F funding round led by Y Combinator's Continuity fund. This round gave Monzo a valuation of £2 billion.[41][42]
U.S expansion
Monzo announced on 13 June 2019 that it would begin offering services in the United States, though it provided no timetable for an actual launch. During its announcement to expand, the company said that it would distribute about 2,000 debit cards to prospective members who attended events held by the company in major U.S. cities like Los Angeles, San Francisco and New York City. Along with retrieval of the debit cards, attendees were expected to offer the company feedback on their products and services.[43]
The company faces a more onerous regulatory situation in the US than in the UK. Financial technology is nationally regulated in the UK, and British regulators have a reputation of being friendly to such companies. By contrast, technology regulation in the financial sector is handled at the state level in the US, with one consultant telling CNN that "US regulators are not that savvy as far as financial services are concerned. They've either been oblivious on regulation, or incredibly strict."
Monzo will enter the US market through a partnership with Ohio-based Sutton Bank, and will retain many of its features, like instant spending notifications and contactless pay. Unlike in how it is able to in the UK, the company will not offer a money lending service to its customers.[44] The company faces a highly competitive and heavily fragmented landscape in the US, with players ranging from tech companies such as PayPal and SoFi to a multitude of traditional banks that are heavily investing in digital platforms.[45]
Issued cards
Monzo initially issued (with partner company Wirecard[46]) a variety of alpha, beta and investor cards to its customers who wanted to be early adopters.[47] These were prepaid Mastercards which the user could top-up via bank transfer or via an existing debit card.[48] The balance on the card could then be spent via contactless, chip and pin, magnetic stripe or online. From early on, Monzo has issued cards in a neon "hot coral" colour - initially intended as a temporary measure during prototyping[49] - but later, a deliberate decision arising from the success of the "eye-catching" design.[50]
In December 2017, Monzo issued new Debit Mastercard cards to all its existing and new customers as the bank began rolling out current accounts. Customers signing up for the current account are issued a Debit Mastercard.[51]
Like all card providers, Monzo enforces a range of limits on ATM withdrawals, top-up amounts, single payments and the overall balance on the card.[48]
Mobile apps
Monzo has released mobile apps for both iOS and Android phones.[52] Payments made with the Monzo cards will trigger push notifications in real-time to phones running the apps, where historical transactions can also be viewed.[46] Users can categorise their transactions, freeze the card (if lost), mark company expenses and view an overview of their spending habits.[53]
Where available, the apps will show a map depicting the location at which the transaction took place, along with the company's logo.[54] Transactions will be auto-categorised based on the company involved in the payment, with data accuracy improved via crowd-sourced suggestions.[55]
A roadmap for Monzo's mobile apps and related services is publicly available to view and vote upon on Trello.[56]
On 29 September 2016, Monzo made the Android app publicly available for anyone in the UK to use.[57] This was preceded by a private beta with consumers who visited the office in-person to collect a card. [citation needed]
Developer tools
Banks in the UK currently offer customers limited or no programmatic access to their financial data.[58] Whilst the UK Government is looking into legislation to require existing banks to comply and adopt standards for secure and open APIs,[59] Monzo has already released a prototype API based on the OAuth standard within a year of the company's founding.
The company has also hosted four hackathons[60] and previously maintained a "Monzo Developers" Slack channel for developer discussion and support. The API allows developers to view transactions and accounts, receive notifications for events via webhooks and create their own items to appear in the app.[61] The responses are encoded using JSON which allows for data access in any programming language with JSON support.[61][62]
Limitations
The company has expressed its intention to do away with a number of banking traditions such as physical branches and chequebooks which it regards as obsolete. Co-founder Tom Blomfield said the bank "will not be right for everyone", and described the company's target demographic as those who value convenience and technical innovation.[63]
See also
References
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- ^ "The UK's new breed of digital challenger banks". Techworld.
- ^ "Welcome to Monzo Bank!". Monzo.
- ^ Burn-Callander, Rebecca. "Banking industry primed for a pocket-sized revolution". The Telegraph.
- ^ Baker, Stephanie. "A Bank for People Who Hate Banks". Bloomberg.
- ^ Carey, Scott. "The UK's new breed of digital challenger banks: Atom, Mondo, Starling and Tandem - Ranked". Techworld.
- ^ Treanor, Jill. "Digital banking: Mondo hopes to become the Google or Facebook of the sector". The Guardian.
- ^ "GoCardless Founder Tom Blomfield's New Startup Is A "Full Stack" Mobile-First Bank". TechCrunch.
- ^ Dawson, Freddie. "App Bank Mondo Crowdfunds £1M In 96 Seconds". Forbes.
- ^ Williams-Grut, Oscar. "App-only bank Mondo is valued at £30 million in an oversubscribed £6 million fundraise". Business Insider.
- ^ Turvill, William. "Mobile challenger bank Mondo reaches £1m crowdfunding target in 96 seconds, adding to £7m venture capital investment". City AM.
- ^ "When do you launch?". Focus FS Ltd. Archived from the original on 7 August 2016.
{{cite web}}: Unknown parameter|dead-url=ignored (|url-status=suggested) (help) - ^ "Monzo, a UK digital-only challenger bank, granted full banking license". TechCrunch.
- ^ O'Hear, Steve. "Mondo, the U.K. banking startup, opens public Beta". Techcrunch.
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- ^ "200,000 Customers and £250,000,000 Spent!". Monzo.
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- ^ "Startup bank Mondo is letting customers change its name". Business Insider.
- ^ "Mondo is now Monzo!". Monzo.
- ^ "The Monzo Current Account Preview!". Monzo.
- ^ "Monzo launches current account preview on Android". SpecialistBanking.
- ^ "Current Account Progress Page". Monzo.
- ^ Price, Rob. "Startup bank Monzo is ending one of its most popular features — unlimited overseas ATM withdrawals". Business Insider. Retrieved 18 October 2017.
- ^ "Connect Monzo to Alexa". Smart Home Geeks. 8 June 2018. Retrieved 8 June 2018.
{{cite web}}: Cite has empty unknown parameter:|dead-url=(help) - ^ Priday, Richard. "The Ticketmaster hack is a perfect storm of bad IT and bad comms". Retrieved 15 August 2018.
- ^ standupmaths (25 July 2018), How to detect bank fraud with maths, retrieved 15 August 2018
- ^ Send money abroad with Monzo and TransferWise!, 25 June 2018
- ^ "Get interest paid on your savings!". monzo.com. Retrieved 13 December 2018.
- ^ "London gets another fintech unicorn as Monzo reaches £1 billion". Evening Standard. 30 October 2018. Retrieved 14 June 2019.
- ^ "LinkedIn announces top 25 start-ups to work for in the UK". Evening Standard. Retrieved 16 July 2019.
- ^ "You can now pay cash into your Monzo account!". monzo.com. Retrieved 15 January 2019.
- ^ O'Hear, Steve. "Monzo teams up with Flux to add itemised receipts and loyalty points". Techcrunch. Techcrunch. Retrieved 29 January 2019.
- ^ A simple Monzo third party API client for demonstrating the new Receipts API. : monzo/reference-receipts-app, Monzo, 3 February 2019, retrieved 3 February 2019
- ^ Stokel-Walker, Chris (6 August 2019). "Monzo's PIN security breach, explained". Wired UK. ISSN 1357-0978. Retrieved 9 August 2019.
- ^ Cimpanu, Catalin. "Monzo admits to storing payment card PINs in internal logs". ZDNet. Retrieved 9 August 2019.
- ^ "Monzo Raises 4.8M in Interim Funding Round led by Passion Capital". Crowdfund Insider.
- ^ "App-only bank Monzo's crowdfunding is almost three times oversubscribed after less than 24 hours". Business Insider.
- ^ "Confirmed: UK challenger bank Monzo raises £19.5M with another £2.5M in crowdfunding planned". TechCrunch. Retrieved 14 June 2019.
- ^ "Challenger bank Monzo raises another £71M from Goodwater Capital, Stripe and Michael Moritz". TechCrunch. Retrieved 14 June 2019.
- ^ "Monzo is raising £20m in latest funding round". www.crowdcube.com. Retrieved 16 July 2019.
- ^ "Monzo, the UK challenger bank, raises £113M Series F led by YC's Continuity fund at a £2B post-money valuation". TechCrunch. Retrieved 16 July 2019.
- ^ Cook, James (25 June 2019). "Monzo's valuation hits £2bn as the digital bank raises £113m in fresh funding". The Telegraph. ISSN 0307-1235. Retrieved 16 July 2019.
- ^ Fuscaldo, Donna. "U.K. Digital-Only Bank Monzo Comes To The U.S." Forbes. Retrieved 11 July 2019.
- ^ Warren, Tom (13 June 2019). "Monzo launches its 'bank of the future' in the US". The Verge. Retrieved 11 July 2019.
- ^ Horowitz, Julia (13 June 2019). "Britain's wildly popular Monzo banking app is coming to America". CNN. Retrieved 22 June 2019.
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- ^ a b "Monzo Terms & Conditions".
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- ^ "Data Sharing and Open Data for Banks" (PDF). Fingleton Associates.
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- ^ a b "Monzo API Reference". Monzo.
- ^ Bray, T. (March 2014). The JavaScript Object Notation (JSON) Data Interchange Format. IETF. doi:10.17487/RFC7159. RFC 7159. Retrieved 13 September 2016.
- ^ "Meet Mondo, the app that's got the banks worried". The Memo.