Monzo Business Account Review

Monzo is a well-known challenger bank in the UK, offering flexible business accounts to sole traders and limited companies. Whether you’re new to banking or switching providers, this review will help you decide if a Monzo Business Account is right for you.

Monzo offers two business account types, Lite (£0/month) and Pro (£5/month), catering to sole traders and limited companies. The accounts include essential banking features like debit cards, budgeting tools, and integration with accounting software.

In this review, we’ll take a closer look at the benefits and drawbacks of Monzo Business Accounts, including the fees, services, and features you can expect.

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Monzo Business Account: A Comprehensive Look

Monzo has become one of the most popular online banks in the UK, known for its user-friendly app and innovative banking services. The Monzo Business Account comes in two plans: the Lite plan, which is free, and the Pro plan, which costs £5 a month. Both plans come with useful features for managing business finances, but they have distinct differences that may affect your choice.

Monzo’s business accounts operate entirely through its mobile app, which allows you to manage your finances on the go. The Lite plan is ideal for smaller businesses or sole traders who need a simple, cost-effective way to manage their money. The Pro plan, on the other hand, offers additional features like invoicing, multi-user access, and integration with accounting software—perfect for growing businesses.

Both accounts are fully regulated by the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA), ensuring that your money is protected up to £85,000 under the Financial Services Compensation Scheme (FSCS).

Opening A Monzo Business Account

Features 

  • Company: Monzo Bank Limited 
  • Account Type: Business current account 
  • Intended For: Limited companies and sole traders 
  • Overdrafts: Available 
  • Loans: Available 
  • Monthly Fee: £0-£5 
  • Debit Card: Included (Debit Mastercard) 
  • Credit Card: Not available 
  • IBAN: Included 

To open a Monzo Business account, visit their website and download the Monzo app on your phone to start the sign-up process

What is a Monzo Business Account? 

Monzo was one of the first online banks based in the UK. Without physical branches, it operates entirely through a frequently updated mobile app. Monzo offers both personal and business current accounts in GBP, with two tiers for business accounts: 

  • Lite: £0/month 
  • Pro: £5/month 

Both plans are available for companies and sole traders, with Pro offering enhanced features suited for limited companies. Every account includes a Debit Mastercard. 

A personal account must be created before a Monzo Business account, resulting in ownership of both account types. Monzo is a fully-fledged bank authorised by the Prudential Regulation Authority (PRA) and regulated by the Financial Conduct Authority (FCA). Up to £85,000 is protected by the Financial Services Compensation Scheme (FSCS) if eligible, similar to high street banks. 

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Our Experience and Opinion 

Monzo is one of the better challenger banks in the UK, based on personal testing and feedback from long-term customers. 

Many appreciate the money pots, which help organise savings and auto-deduct taxes from incoming payments. Monzo excels at managing budgets, savings, and payments, though limited companies miss out on the loan and overdraft options available to sole traders. 

Many previous shortcomings, such as overdraft, loan, savings account, and payment acceptance, have been addressed in recent years. However, customer service still struggles to resolve issues promptly. 

The fast sign-up process and lack of monthly fees for the Lite account are attractive, considering the value of a real business bank account. The Pro account benefits from invoicing, accounting integration, and multi-user access for a modest £5 monthly fee. 

Discover the Benefits of Monzo Business Accounts. Click the link below and get started.

Features of Monzo Business Accounts

Monzo Lite vs. Monzo Pro:

Monzo’s Lite account offers basic features like a debit card, access to the mobile app, and budgeting tools. However, for businesses that need more advanced features, the Pro plan is the better option. Here’s a breakdown of what each plan offers:

  • Monzo Lite:

    • Free to use
    • No monthly fee
    • Includes a Debit Mastercard
    • Basic budgeting tools
    • Access to the mobile app for managing accounts
  • Monzo Pro:

    • £5 per month
    • Includes all Lite features
    • Multi-user access for managing accounts
    • Integration with accounting apps (FreeAgent, QuickBooks, Xero)
    • Invoicing feature
    • Tax Pot for automatic tax savings
    • Enhanced customer support

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Pros and Cons of Monzo Business Accounts

Pros:

  • No monthly fee for the Lite plan
  • Free bank transfers within the UK
  • Easy access to budgeting tools and Money Pots
  • Available 24/7 customer support
  • Simple, fast sign-up process

Cons:

  • No credit card option
  • Loan and overdraft facilities are available only for sole traders, not limited companies
  • Cash deposit limits can be restrictive for some businesses
  • Some international transactions require a Wise account
  • Customer service can sometimes be slow to respond

Who Can Open a Monzo Business Account? 

To open a Monzo Business account, you must be a limited company or sole trader based, registered, and a tax resident in the UK. Companies must have an active status on Companies House, an active director, and at least one person of significant control listed on Companies House. Corporate directors or persons of significant control are not permitted. 

Monzo does not accept partnerships, limited liability partnerships (LLP), limited companies by guarantee, public limited companies (PLC), charities, community interest companies (CIC), trusts, clubs, or other non-registered organisations. Businesses in high-risk industries, such as legally dubious or illegal trades, sales of precious jewellery, and financial services, are also not accepted. 

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Costs and Fees 

It is free to open a Monzo Business account, and there is no minimum contract. 

Business Account Charges 

  • Account Creation: Free 
  • Monthly Fee: Lite plan – £0, Pro plan – £5 
  • Card Payments in GBP (anywhere): Free 
  • Card Payments in Other Currency (anywhere): Uses Mastercard’s wholesale rate with no added fees 
  • Bank Transfers (UK): Free 
  • ATM Withdrawals: In UK and EEA – Free, All other countries – First £200 during a 30-day period is free, above that costs 3% of the withdrawal amount 
  • Cash Deposits: £1 each 
  • Cheque Deposits: Free (via Freepost) 
  • Receiving Transfers from a Different Currency: 1% currency conversion fee 
  • Sending International Payments: Variable Wise transfer fees 

UK bank transfers are free, debit card payments worldwide incur no fees, and ATM withdrawals are free within the UK and EEA. Outside these areas, the first £200 withdrawn during a 30-day period is free, with a 3% fee for amounts above that. Cash deposits cost £1 each, deducted from the deposited amount. Cheques are free to process via Freepost, though some users prefer tracked postage for reassurance. 

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Monzo Business Account Services

International Payments 

Monzo’s current accounts include a bank account number, sort code, and IBAN for international transfers. Only GBP is stored, with foreign currency conversions subject to a 1% fee. International transfers are facilitated through Wise, a platform integrated into the Monzo app, offering low fees and reliable currency exchanges. 

Card, Cash, and Cheques 

Every Monzo Business account comes with a Debit Mastercard featuring chip, contactless, and swipe facilities. The card can be added to Apple Pay or Google Pay wallets. It is accepted wherever Mastercard is recognised, though occasional issues may arise in countries like Bulgaria, Portugal, and Cuba. 

Cash Withdrawal Limits 

  • Daily: £400 
  • Over 30 Days: £5,500 
  • Fee-free Outside EEA Over 30 Days: £200 

Cash deposits up to £300 can be made at any PayPoint in the UK for £1. Deposits take up to 10 minutes to appear in the account. The maximum deposit limit is £1,000 every six months, which may be inadequate for cash-heavy businesses. Cheques can be deposited via Freepost, with a processing time of 2-3 weeks. 

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No Credit Card, But Overdraft and Loan Possible 

Monzo does not offer credit cards but provides loan and overdraft options for business accounts. Only eligible sole traders can apply for loans and overdrafts, with a maximum overdraft of £2,000. 

Monzo App 

The Monzo app, available for iPhone and Android, provides a smooth banking experience. Users can switch between personal and business accounts and utilise various features such as: 

  • Payments: Transfer money, set up standing orders or Direct Debits, and send money internationally via Wise. 
  • Saving Pots: Save money into labelled pots, separate from the main account balance. 
  • Budgeting: Set spending limits and track expenses. 
  • Manage Cards: Freeze and unfreeze cards, view PINs, and more. 
  • Information Access: Check account limits, fees, statements, and search for help. 

The Pro plan allows multiple users to manage the account and includes a Tax Pot for automatic tax deductions. 

Getting Paid Through Links, Invoices, and Contactless 

Monzo Business offers several ways to accept card payments: 

  • Payment Links: Send links via text, email, or social apps. 
  • QR Codes: Share or display QR codes for customers to scan and pay. 
  • Invoicing: Send email invoices with payment due dates. 
  • Tap to Pay: Accept contactless payments via NFC-enabled phones. 

Stripe handles card processing, with transaction fees ranging from 1.5%-3.25% + 20p. 

Accounting Integrations 

The Lite account does not support external app integrations. The Pro account syncs with FreeAgent, QuickBooks, and Xero, and allows auto-export of transactions and statements to Google Sheets. Pro users also receive special deals from select software partners. 

Customer Service and Reviews 

Monzo offers 24/7 support via in-app messaging, email, and phone. Email and chat support are slower, so calling is recommended. The Monzo community forum provides peer support. Reviews on TrustPilot are generally positive, but issues like frozen accounts and slow customer service responses are common complaints. 

Signing Up 

Sign up through the Monzo app, available on the App Store or Google Play. The process includes submitting personal and financial details, verifying your identity with a photo ID and video, and performing a soft credit check. Approval typically takes 5-60 minutes. After creating a personal account, you can add a Business account from the app menu. 

If switching from another bank, the Current Account Switch Service in the app simplifies the process by closing the old account, transferring funds, and redirecting payments to Monzo. 

FAQ

Can I get a loan or overdraft with a Monzo Business Account?

Monzo offers overdrafts and loans only to sole traders, not limited companies. The maximum overdraft limit is £2,000.

Are international transactions free with Monzo?

International transfers are free within the UK. For international payments, Monzo uses Wise, which offers low conversion fees (1%).

Can I deposit cash into my Monzo Business Account?

Yes, you can deposit cash at PayPoint locations for a £1 fee. However, there are limits on how much you can deposit.

What’s the difference between the Lite and Pro plans?

The Lite plan is free, while the Pro plan costs £5/month and includes additional features like invoicing, tax savings pots, and multi-user access.