Digital banks have been populating the UK market in the last few years. Most of them, like Monzo, began by offering a basic free current account that can be set up and managed entirely through an app, to which a savings option was then added. Atom, instead, went directly for savings accounts and mortgages, which are more difficult to find in the challengers’ product ranges.
We cover Monzo’s and Atom’s savings features, differences and similarities to help you decide if either appeals to you.
Monzo and Atom are both challengers that aim to simplify the banking experience by using app technology and avoiding paperwork and physical branches. You can open an account for free with both of them within minutes.
However, they respond to two different needs. Atom doesn’t offer a current account option, so it’s obviously not what you’re looking for when it comes to day-to-day banking. On the other hand, Monzo’s Saving Pots aren’t a stand-alone product but an offshoot of its main current account.
Atom’s products are specifically meant for saving. You can choose from instant access accounts as well as fixed rate bonds with terms of between 6 months and 5 years. You can save from as little as £1 to £100,000, depending on the account. You can also choose between monthly and annual interest rates.
If you open an instant access account with Atom, you can pay in and withdraw cash whenever you want – although its Instant Saver Reward account pays a higher interest rate each month you don’t withdraw any cash. If you open a fixed rate saver, you have one week to put money into it. After that, your account is locked in both directions: you can’t add any more money, nor can you withdraw it until the product expires.
As usual, the longer is the account life, the higher is the interest rate likely to be.
By contrast, Monzo is a current account, but launched its Savings Pots feature in April 2019. This means its range of accounts isn’t as broad as you’ll find with Atom – you can currently choose from instant access pots, and an instant access cash ISA. These sit within your main account and the interest rate you’ll get depends on the type of savings pot you choose. You can deposit up to £500,000 per person per pot type.
Safety
Your money is safe and sound with both Monzo and Atom bank: they both have a UK banking licence and deposits are protected up to £85,000 by the Financial Services Compensation Scheme (FSCS).
Atom uses biometrics to protect to the app (face and voice recognition plus a passcode), while Monzo requires either your card’s PIN or your fingerprint to move money from your account.
Monzo vs Atom: the verdict
Monzo and Atom both offer an easy and smart way to set aside money for the future, but target customers with two different sort of needs.
In a nutshell, Atom is geared towards those looking for instant access or fixed rate savings accounts and offers competitive rates of return. But you’ll need to be happy keeping your savings with a different provider to your main bank account. On the other hand, if you’re keen on a new current account for your day-to-day banking, and as a cherry on top you’d also like some interests on your savings, with Monzo you’re probably on the right track.
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Valentina Cipriani was a writer at Finder UK. She wrote news, features and guides about banking and credit cards, helping people to improve their financial lives. She holds an MA in International Journalism. See full bio
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