App Based Banking Review - January 2019 (Starling, Monzo & N26)

Hello all,
Over the last few months I’ve tried out three of the UK digital/app banking options and I thought I share my experiences because I’ve found it hard to get an up to date review online. I’ll try to keep it brief and to the point, and I hope it helps someone who might be interested and/or is currently comparing this new & crowded market segment make their own decision.

STARLING BANK

PROS:

• Can authorise more than one device to use the app
• Card arrived in the post the fastest of the three & ID ‘verification’ wait was the shortest at only a few hours.
• You get a new account number and sort code at the point of application.
• Part of UK Current Account Switching Service & FSCS ‘protected’.
• I used customer service twice, both times chatting was satisfactory with ‘live’ chat or inbox style messages.
• They are the only one of the three to pay a (small) amount of interest on balances.
• Can deposit cash at the post office for free, can send cheques in the post.

CONS:

• No facility to re-apply for Overdrafts / Starling Loan products (turning part of your OD into a Personal Loan). If they don’t offer it you when you sign up, tough luck.
• Cannot rename bank accounts in the App (E.g. ‘Joint Account’, ‘Checking Account’)
• If you close your account you can’t re-open it for 12 months, there doesn’t seem to be a good reason for this.
• It’s the only one of the three that has no online banking facility at all – lose your phone and you can’t access your finances. I asked if I lost my phone would I be able to call them to move money from my spaces (savings pots) to the main account if I needed to (e.g. buy a new phone) – they said ‘no’.

MONZO

PROS:

• Good budgeting features in the app, but only designed to work on a monthly basis (e.g. salary) for your main account, and can’t be switched off.
• Flexible overdraft functions (£50 intervals) & can re-apply by messaging customer service.
• Customer service fast and best of the three in my experience.
• Online blog seems to be the most engaged with incorporating new features / customer requests.
• Part of UK Current Account Switching Service & FSCS ‘protected’.
• Can verify online transactions in real time via the app.
• Only one of the three to allow you to ‘lock’ (freeze) your savings pots for a later date if you want / apply for longer term investments in the app (through a partner).
• Can pay in cash at any PayPoint location (£1 fee), not sure about cheques.

CONS:

• You can’t rename payees in the android app, so make sure you spell them right the first time (although you can delete them)
• Reminders from the app requesting access to your address book cannot be switched off

N26

PROS:

• Best looking app in my opinion (cleanest)
• Spending analytics is available but not made mandatory
• Most functional online banking with web based customer support
• Only one to offer ‘unlimited’ GBP cash withdrawals in the UK for UK-based accounts (in reality limited to £2500/day, and there have been reports of accounts being closed for overuse).

CONS:

• You have to make a cash withdrawal to fully activate your card
• Can’t pay cash into account in the UK (via some retailers only in Germany). No cheques at all.
• Android app does not save payees, although you can search transaction history and make a note. Asked customer service – this is a known issue but no plans to rectify.
• Can only authorise one device at once, but can de-authorize online if required.
• Not part of UK Current Account Switching Service, but you can close your account online.

In summary, I’ve decided that although these fintech banks are interesting, none of them are ready to replace my regular, high-street joint account, in my opinion. All three offer instant payment notifications, an easy sign up process if you have photo ID, and all the cards worked fine for me at all times. All three also group Standing Orders and Direct Debits into ‘regular payments’ if this matters to you, and also include pending transactions in your [available] balance. For Starling, overall the lack of flexibility / ability to re-apply for credit made me switch to Monzo. I found the Monzo app a bit busy and did not enjoy being forced to categorise my spending and bank transfers, although overall I would say Monzo is the most mature product and the one I’d recommend from my experience. After moving (not switching) to N26 I found not being able to store payees a deal breaker, although apparently this is Android app specific.

Hope this is useful!