U.K. digital bank Monzo is officially entering the U.S. market this week. The startup announced it’s now allowing U.S. clients to apply for a Monzo account.
Monzo has been in closed beta for the past 18 months, during which time it has onboarded thousands of new U.S. customers, processed millions of dollars of transactions, and gathered user feedback.
The company has launched new features inspired by this feedback, one of which is a salary sorter. This tool that helps users divide their paycheck, separating their spending, savings, and bills once their paycheck is received.
This week’s news comes after Monzo withdrew its U.S. banking license application last October. “While this isn’t the outcome we initially set out to achieve, this allows us to build and scale our early-stage product offer in the U.S. through existing partners and invest further in the U.K.,” a Monzo spokesperson told CNBC last year. “We have big ambitions for Monzo U.S. There are many routes to market we’re exploring that have been successful for other market entrants who are now major players.”
One of those “routes” is a partnership with a traditional bank based in the U.S. While Monzo is a fully licensed bank in the U.K., the startup is partnering with Ohio-based Sutton Bank to provide its U.S. accounts. Sutton will hold user deposits and provide protection with FDIC insurance.
Monzo was founded in 2015 and seeks to be a hub for users to manage their entire financial lives via its mobile app. In addition to financial management and budgeting, Monzo also offers a Mastercard debit card with no overdraft fees, no minimum balance, and no foreign exchange fees.
The digital bank has five million U.K. customers. This number is small when compared to competitor Revolut, which counts more than 14.5 million users. However, Monzo U.S. Product Manager Thomas George noted that it’s not just about the number. “We don’t believe it’s possible to build a globally impactful company without considering the impact we have on the communities we serve,” George said. “Too many people around the world lack access to vital banking services. So we’re also working to improve financial inclusion, support customers in vulnerable circumstances, and play our part in creating a more just society.”
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