The UK’s competition watchdog has warned Monzo over a breach of retail banking regulations in which the challenger bank “failed” to sufficiently disclose the monthly minimum charge for its personal current account.
The Competition and Markets Authority (CMA) said it was “concerned” that Monzo customers may not have seen the £15.50 monthly minimum charge “since it was not displayed each time information on Monzo Bank’s fees and charges for exceeding a pre-agreed credit limit was disclosed”.
The breach of the Retail Banking Market Investigation Order 2017 took place between 25 October 2018 and 19 November 2021.
The CMA said: “This measure, in combination with other parts of our reforms, was designed to make it easier for consumers to be aware of the charges they may be liable to pay and compare this information easily against other PCA providers.”
Monzo updated its fee information in November 2021, the CMA said, and has improved its product governance and increased the size of its compliance teams.
The CMA said it would not be taking any further action because of the steps Monzo has taken.
“The CMA will monitor Monzo Bank’s future compliance closely,” the regulator said.
A Monzo spokesperson told UKTN: “As the CMA has recognised, this is a legacy issue that we addressed last year and we have taken steps to make sure it does not happen again.”
In December Monzo raised $500m in a funding round that gave it a valuation of $4.5bn. It followed a turbulent two years for the challenger bank, with the pandemic scuppering plans to break into the US market and its founder Tom Blomfield stepped down last spring.