Digital bank Monzo opens its accounts to welcome 16 and 17-year-old teens
App-based, mobile-only Monzo bank has taken the next step in its aim of making money work for everyone by allowing anyone aged 16-17 in the UK to have one of its accounts.
The younger teenagers now have access to most of the same services that adults over 18 have, but some retailers like gambling sites will be blocked automatically.
It means another 1.5 million teens can set up direct debits and standing orders as well as send and receive money by bank transfer. However, they will not be able to run overdrafts. If the young adults do overspend then Monzo won’t charge and will simply ask for the money to be returned.
Unlike high street banks, Monzo is a purely digital service managed through an app. The bank has no branches.
Monzo was founded in 2015 by Tom Blomfield, Jason Bates, Paul Rippon, Jonas Huckestein and Gary Dolman, who met while working for competitor Starling Bank. Monzo is designed to help people keep an eye on their spending by tracking and categorising what they’re buying, like food in restaurants, clothes and entertainment.
Monzo CEO Blomfield says the move to help young people get to grips with their money is a central plank in the bank’s mission. The aim is for people to be able to manage their funds more easily and have a clearer idea of where they need to cut down. Customers receive regular updates on their spending budgets and bill splitting.
Similar app based digital banks include Revolut, Tandem and Starling, but Monzo has been first to offer their accounts to people as young as 16.
The bank hopes the young adults will find it easier to take control of their finances earlier. Monzo has already allowed older customers to turn a feature on that automatically stops payments made to gambling merchants. And, because gambling is illegal for people under 18, the new 16 to 17-year-old account holders will find their accounts automatically block them from gambling activity.
However, they will still be able to use their accounts to buy alcohol because Monzo has to be able to block the retailer, and it can’t differentiate the products.
To open a Monzo account, teens simply download the app from the Monzo website and follow the instructions. A debit card will be sent the next working day. The account for 16 to 17-year-olds provides:
- A full UK current account with account number and sort code.
- A contactless debit card.
- The complete Monzo app with instant updates on spending, clever budgeting, notifications if you spend too fast and easy bill splitting with any of your friends on Monzo.
- The ability to link with Apple Pay or Google Pay so you can turn your phone or smartwatch into your bank card.
Monzo also promises the young teens that when they turn 18, the bank will automatically remove the account’s spending blocks and review their spending and withdrawal limits.
If you are new to app-based banking finder UK can let you know how it works. To find out how Monzo measures up read our review and compare it to one of its leading competitors.
Picture: Monzo
