Monzo, the challenger bank, provides loans with fixed monthly repayments, same-day funding, and flexible amounts, all managed conveniently through the Monzo App. However, since it has higher rates than others in the market, it's a good idea to compare before deciding. If you can’t make your repayments, you run the risk of damaging your credit score.
Pros
Instant decisions
Same-day funding facility
Flexibility over early repayment
Cons
Only available to Monzo customers
High APR on smaller loans
No payment holidays
Representative example: Borrow £10,000.00 over 3 years at a rate of 25.7% p.a. (fixed). Representative APR 25.7% and total payable £13,952.52 in monthly repayments of £387.57.
Finder Award
★★★★★
Finder score
Maximum loan
£25,000
Product fee
N/A
Early redemption fee
£0
Monzo loan calculator
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How do Monzo loans compare against the competition?
Please note: You should always refer to your loan agreement for exact repayment amounts as they may vary from our results.
Late repayments can cause you serious money problems. See our debt help guides.
What is Monzo?
Monzo is one of the leading challenger banks in the UK and now offers personal loans through its popular app. Unlike traditional lenders, Monzo loans are online-only and you’ll need to create a Monzo account and download the app to apply for a loan.
Monzo loan rates at a glance
The Monzo Bank Personal Loan charges 14.8%APR representative on loans between £10,000 and £25,000. Monzo offers the loan with repayment terms between 2 and 5years, and applicants can apply to borrow from £200 to £25,000.
Quick overview of Monzo Bank personal loans
Loan amounts
From £200 to £25,000
Loan terms
From 2 months to 5 years
Age eligibility
18 years and over
Application fee
No application fee
Repayment holiday
Repayment holiday not permitted
Key features
Monzo offers unsecured loans, which means you don’t need to use an asset as security against the loan. Instead, you’ll be approved for a loan based on your credit score and ability to pay back the loan amount. You can borrow from £200 up to £15,000, with a loan period of 2 to 5 years.
You’ll receive a fixed interest rate, so your monthly payments will remain the same throughout the loan and you’ll know in advance what it will cost overall. Your rate will vary depending on factors like your credit history and the loan that you apply for. Before it can offer you a loan, Monzo will check your credit history through the credit reference agency Transunion.
Loan type
Unsecured Personal Loan
Loan amounts
£200.00 to £25,000.00
Loan terms
2 Years to 5 Years
Loan rate type
Fixed
Product fee
0%
Same-day funding available
Instant decisions in most cases
Soft-search facility available
Joint applications
Overpay without penalty
Concurrent loans allowed
Topping-up pays off existing loan and initiates a new loan
Repayment methods
Direct Debit
How do Monzo loans work?
You’ll need to be an existing customer and already have the app. Here’s the typical process for taking out and repaying a Monzo loan:
Go to the “Account” tab in your Monzo app, then tap on “Loans and overdrafts” to begin your application. You’ll need to meet Monzo’s credit score requirements to be eligible for a loan.
Select how much you want to borrow and your loan period, then click “Review Your Loan”.
Once you’ve reviewed your loan terms, tap to apply.
Once you’ve been approved for a loan, you’ll receive your funds on the same day.
Monzo will then take automatic monthly payments from your current account in order to repay the loan. You can track how much you’ve paid, your remaining payments and the cost of the loan using the Monzo app.
Pros and cons
Pros
Flexible loan amounts. You can borrow from as little as £200 or up to £25,000.
Early repayment option. You can make extra repayments or even pay your loan off early without penalty.
Simple online application. If you have a Monzo account, you can apply for a loan within minutes using the app.
Fast funding. You can be approved for a loan and receive your funds the same day you apply.
Online tracking. You can manage your loan using the Monzo app.
Cons
Only available to Monzo customers. You’ll need to have an existing Monzo account, or sign up for one, to apply for a loan.
Minimum credit rating required. You’ll need to have a certain credit score and history to be eligible for a loan. You can check your credit score through Credit Karma using your Monzo app.
High APR on smaller loans. Be wary of borrowing small amounts over lengthy periods – this makes for low monthly repayments but a relatively high overall cost.
What is APR?
The Annual Percentage Rate (APR) is a representative figure that’s designed to show you the annual cost of a loan. It can be a handy tool when comparing different loans, but don’t let it distract you from the overall cost. The APR combines both the interest rate and any mandatory fees or charges that you’ll need to pay on the loan.
Lenders such as Monzo must all calculate their APRs in the same way and must provide you with this figure before you agree to anything. However, most people don’t realise that lenders only have to offer the advertised representative APR to 51% of customers who take out the loan. That means you may end up paying more, depending on Monzo’s assessment of your financial circumstances and history.
Am I eligible for a Monzo loan?
You’ll need to meet the following criteria to be eligible for a Monzo personal loan:
You must be at least 18 years old.
Be a UK resident.
Have an existing Monzo account.
Meet Monzo’s minimum credit history and credit score requirements.
Monzo customer reviews
Monzo won the personal loans category in the Finder Customer Satisfaction Awards 2024. Many Monzo loans customers in our survey said the bank was easy to deal with, and an impressive 97% said they’d recommend the brand to a friend.
One respondent said:”They were very helpful, and it was a straightforward process to apply.”
Another said:”Can overpay really easily and instantly reduce monthly payments. Can see progress towards paying off loan and it’s really user friendly.”
Over on reviews platform Trustpilot, Monzo overall has a rating of 3.9 out of 5, based on more than 30,000 reviews (updated January 2024).
Customer support
For any queries you can message customer support through the Monzo app. Alternatively, you can call Monzo on 0800 802 1281.
Frequently asked questions
Monzo will provide your interest rate when you apply for a loan. As with other lenders, Monzo is only obligated to provide the APR to 51% of loan customers, and the rate you receive may be higher, depending on your credit history, financial situation and your loan terms.
Yes, you are free to select your repayment date when applying for a loan, and can change it later without penalty.
If your credit score doesn’t meet Monzo’s requirements, you’ll be unable to apply for a personal loan. However, you can use Credit Karma to check your score for free and learn how to improve it.
Yes, you can pay off your loan early or make additional repayments with no fee. This can be managed via the Monzo app.
You can apply for a Monzo account within minutes, and be approved the same day. However, your bank card may take a few weeks to arrive.
Finder.com has selected Accepty Technology Ltd to provide details of credit products and whether you may be eligible to get them. Accepty Technology Ltd is authorised and regulated by the Financial Conduct Authority (FRN: 839295). Accepty is acting as a credit broker, not a lender, and may receive a payment from a credit provider if you take out a credit product.
We show offers we can track - that's not every product on the market...yet. Unless we've said otherwise, products are in no particular order. The terms "best", "top", "cheap" (and variations of these) aren't ratings, though we always explain what's great about a product when we highlight it. This is subject to our terms of use. When you make major financial decisions, consider getting independent financial advice. Always consider your own circumstances when you compare products so you get what's right for you.
Chris Lilly is Head of publishing at finder.com. He's a specialist in personal finance, from day-to-day banking to investing to borrowing, and is passionate about helping UK consumers make informed decisions about their money. In his spare time Chris likes forcing his kids to exercise more.
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