Starling vs Monzo: Fees, Terms, and Service Compared for 2024

Anne Boden founded Starling Bank back in 2014, following an esteemed career working for the likes of Allied Irish Banks and the Royal Bank of Scotland. The team, in their own words, “built a bank from scratch” with a customer-centric approach to challenge traditional players by simplifying banking.

In 2015, Tom Blomfield, Gary Dolman, Jason Bates, Paul Rippon, and Jonas Huckestein split from Starling to form their own bank, Monzo. It quickly became one of the pioneers of the banking revolution and Starling’s most fierce rival. As of 2022, Monzo surpassed Starling in active users by a staggering 2.8 million.

Today, Starling is known for its market-leading features, whereas Monzo is celebrated for providing an all-around banking experience. Both are online-only banks: they don’t have branch offices, high overhead costs, or cumbersome application processes.

Below, we explore the key similarities and differences between the two banks' features, fees, security, and more. Whether you're a budget-conscious user or simply seeking a convenient and hassle-free way to manage your finances, we'll guide you through the comparison process and help you make an informed decision.

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	Name	Score	Visit	Disclaimer
	1Monzo	8.4	Visitmonzo.com
	2Starling Bank	8.5	Visitstarlingbank.com

Starling and Monzo’s in-app features largely overlap: both offer budgeting tools, spending analytics, and instant notifications of spending and incoming payments. All these features are a great help for you to be on top of your spending and know how much is in your account. You can also set up direct debits for your bill payments and standing orders for other subscriptions and payments.

Both banks excel in effective card management.

In the age of reckless spending and digital miscreants, it's more important than ever to have some control over our financial tools. Luckily, both of these banks offer a solution to this problem – behavioural blocks on your card that can put the brakes on your gambling habits, for instance. And if you happen to misplace your card, you can quickly freeze your card through the app, and unfreeze if it turns up. Both offer various options for topping up your account, including bank transfers, direct deposits, and even old-fashioned cash deposits at partner locations across the UK, so you'll never be caught short. And if you're still a fan of cheques, you can scan them digitally through the app with ease.

Note that Monzo will charge £1 per cash deposit for standard accounts, while Starling allows £1,000 deposits for free per year. After that, a 0.7% charge kicks in.

Both banks offer various ways to split bills with friends and family, but Starling takes it a step further. You can send and receive money to and from nearby Starling users via Bluetooth, and send out links to settle IOUs (I owe you). You can simply share the link on a group chat, and anyone contributing can click on it and make the transfer – so long, copying account numbers and sort codes!

Both banks offer ways of splitting bills, but Starling takes it a step further. You can send and receive money via Bluetooth with nearby Starling users and send out links to settle IOUs.

Both banks have extensive savings and some lending facilities, which we discuss in detail below.

	Name	Score	Visit	Disclaimer
	Starling Bank	8.5	Visitstarlingbank.com

Both offer savings pots, though Starling calls them “spaces”, where users can create as many as they like catering to different goals. Both have the challenger-bank flagship feature “round-up”, which rounds up each purchase you make to the nearest pound and deposits the difference into your savings. This may sound trivial, but it often adds up faster than interest.

Monzo is also quite creative in its campaigns for saving. There are automatic savings triggers, for example, dropping £5 into your Rainy Day Pot every time it gets hotter than 20 degrees, rewarding yourself with a boost whenever you visit the gym, or notifications to help stick with the 1p challenge.

What is the 1p challenge?

Money Saving Expert’s Martin Lewis shared his way of squirrelling away money without much effort. The viral challenge starts with putting 1p on the first day of January. Then, you should put in the equivalent amount of pennies on the day of the year. So it goes, 1p on January 1, 2p on January 2, 3p on January 3, and so on. If done correctly, you’ll end up with £667.95 by the end of the year.

Monzo only pays interest on Premium and Pro accounts for balances up to £2,000, ranging from 1% to 1.5% AER, while Starling pays 0.5% AER on balances up to £85,000.

Starling also recently launched a 1-Year Fixed-Rate Saver account. You can lock up any amount between £2,000 and £1,000,000 and earn interest at an AER rate of 3.25%. Managing the saver account through Spaces is possible, and you can’t touch it for a year. It’s a functional feature for those who can’t help dipping into their savings.

Yet, Monzo has the edge here. It partnered with other UK banks, including OakNorth and Charter Savings Bank, to offer numerous (and better) rates. You can choose from instant or easy access, fixed, and ISA accounts – the rates vary between 1.01% to 4.0% AER.

	Current Account	Fix-Rate Saver	Easy Access	Cash ISA
Starling	0.5% AER	4% AER	N/A	N/A
Monzo	1% for Pro users, 1.5% for Premium users	3.25%	3.20% AER	2%

The changes are, though, nominal, that most of us don’t have so much sitting in our accounts for the difference between 3.25% and 4.0% to become a major issue. While it perhaps matters less to many folks, the budgeting and saving features embedded in apps can encourage good saving and budgeting behaviour.

Both Starling and Monzo have budgeting tools that allow you to categorise your spending. You can mix and match with other features:

• With Starling, you can create designated Spaces for various types of spending, like entertainment, groceries, rent, etc. Then, you can allocate your income to these Spaces and see how much you will end up with at the end of the month. Starling also allows you to pay directly from Spaces using a virtual card.

• With Monzo, you can do the same, but you will have to transfer your money from your pot into your primary account, as it’s not possible to spend directly from a pot.

Monzo also allows you to set budget limits, you can allocate limits per category and be notified when you get close to your limit. Starling doesn't offer a limit-setting feature.

Winner:

Monzo. Although the differences are minimal, Monzo does offer better interest rates than Starling, along with more account options and creative solutions that encourage users to grow their savings.

	Name	Score	Visit	Disclaimer
	Monzo	8.4	Visitmonzo.com

Both banks offer overdraft facilities and exhibit a kind attitude towards unarranged overdrafts. In a (hopefully) rare instance where you go over your arranged overdraft,

• Monzo will charge the same amount of interest as your arranged overdraft,

• Starling will not charge you any interest on the amount overdrawn.

To illustrate the overdraft charges, let’s look into the interest cost of borrowing £500 at different rates.

Monzo

	7 Days	30 Days
19% EAR/APR	£1.68	£7.20
29% EAR/APR	£2.47	£10.58
39% EAR/APR	£3.20	£10.72

Starling

	7 Days	30 Days
15% EAR	£1.35	£5.81
25% EAR	£2.16	£9.33
35% EAR	£2.92	£12.63

What are EAR, APR, and AER?

• The Annual Equivalent Rate (AER) is the rate of interest you can earn on your savings, considering how often interest is paid and how it is calculated. It provides a standard way of comparing different savings accounts and helps you determine which account will likely offer you the best return on your investment.

• The Annual Percentage Rate (APR) is the rate of interest you pay on a loan or credit card, and it takes into account any fees and charges associated with the loan. This means that the APR gives you a more accurate picture of the overall cost of borrowing, including any additional costs beyond the interest rate.

• The Effective Annual Rate (EAR) is the rate of interest you'll pay or earn over a year, considering the impact of compounding. This is important because it means that interest can be added to your account at regular intervals, which can significantly increase the overall amount of interest you earn or pay.

Monzo also offers personal loans, whereas Sterling’s loan services are limited to business accounts. Yet, Monzo’s rates are hardly competitive: the representative rate for a £10,000 loan paid over three years is 26%, for example. For comparison, Barclay’s rate for the exact requirements is 20%.

Winner:

Monzo. Despite the slightly high overdraft and loan interest rates, it has the edge over Starling as it presents a more rounded lending offering in comparison.

	Name	Score	Visit	Disclaimer
	Monzo	8.4	Visitmonzo.com

When it comes to spending within the UK, both Monzo and Starling have got your back – and your wallet. There are no fees for domestic spending whatsoever, and both cards also have the standard daily transaction and contactless limits, set at £10,000 and £100, respectively. Plus, you can use both cards with Apple Pay and Google Pay, making payments a breeze. While Samsung Pay may not be as popular (yet still, it accounts for 9% of all digital transactions within the UK), it's worth noting that Starling is the only option if you're a fan.

There are a few differences to keep in mind regarding withdrawals. A Starling account allows only six withdrawals per day, with a maximum amount of £300 per transaction. Monzo has no such restrictions, but there are additional fees for withdrawals exceeding £250 per day. The bank has only recently lowered the limit on free withdrawals, noting that this decision will only affect 20% of its user base.

Finally, there's the matter of Spaces or pots. Starling users have the freedom to directly spend from these accounts, while Monzo only allows paid users to do so. So, if you're looking for the ultimate in flexibility and convenience, Starling may be the way to go.

	Name	Score	Visit	Disclaimer
	Starling Bank	8.5	Visitstarlingbank.com

Unlike Starling, Monzo offers tiered accounts: a Plus account sets you back £5/month, whereas Premium costs £15/month. Paid accounts, akin to packaged bank accounts, come with a host of additional perks like phone and travel insurance or higher interest on savings accounts. Note that certain features that are available in Starling's free account, most notably virtual cards, require a paid account with Monzo.

The types of accounts offered by different banks are standard, with both offering children's, savings, and joint bank accounts. While most accounts overlap, Starling is the bank to turn to for self-employed accounts and small businesses. With its business bank accounts, you get the following for free:

• Integration with accounting software Quickbooks, Free Agent, and Xero,

• Overdraft (interest charges apply),

• Transfers and withdrawals,

• Multiple user access.

With Monzo, you must get a paid account for integrations and multi-user access.

	Name	Score	Visit	Disclaimer
	Starling Bank	8.5	Visitstarlingbank.com

One of the biggest attractions to challenger banks is their incredibly easy signing-up process – and both our contestants rank well. Signing up takes less than a day for each bank, and you will see your debit card in the mail within a few days.

For each bank, you will need one of the following documents:

• A valid passport,

• UK biometric residence permit,

• UK photo card driving licence (full or provisional),

• EU/EEA ID card.

They may also require your proof of address. If you don’t have a driving licence yet, you can provide any official document with your full name and current address. These include;

• Mortgage statements,

• Bank statements,

• Utility bills.

Both banks run a ‘soft-credit check’. It is to determine whether you are eligible for optional overdraft facilities, and it doesn’t affect your credit score.

	Name	Score	Visit	Disclaimer
	Monzo	8.4	Visitmonzo.com

	Name	Score	Visit	Disclaimer
	Starling Bank	8.5	Visitstarlingbank.com

At times, challenger banks seem too good to be true: less-than-a-day account opening, very low fees, and attractive applications – these are very un-banklike. This naturally leads people to think they are scams, but that’s far from the truth.

The same systems and official bodies, the Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA), protect and regulate the likes of NatWest and Lloyds and do so with Starling and Monzo. This means that your funds will be protected under the Financial Services Compensation Scheme (FSCS).

Both banks follow standard anti-fraud and protection methods like biometric log-ins, 2-factor authentication, and 3D security.

Virtual cards became a fixture among neobank offerings. They are essentially disposable and allow you to shop online without using your actual card details to provide you with an extra layer of security. You get this incredibly helpful feature free of charge with Starling, whereas Monzo users have to pay subscription fees.

	Name	Score	Visit	Disclaimer
	Starling Bank	8.5	Visitstarlingbank.com

Both banks are suitable for travelling and offer pretty good deals for sending money transfers abroad.

Monzo provides GBP balances only, while Starling allows you to open EUR personal account and a USD business account for £5/month. Using Starling’s multi-currency function, you can send and receive euros for free from anyone in the Eurozone. If you make a trip there, you can use your EUR balance directly. For conversions, Starling levies a set 0.4% fee.

• We also list the best US dollar and euro accounts for UK residents — make sure to visit for more options.

Although it doesn’t offer a multi-currency account, Monzo has the edge over money transfers. Wise powers its international money transfer function, and it has attractive perks:

• No exchange rate markup, so you get the mid-market rate,

• You have a global reach of 50 countries, compared to Starling’s 17.

Both banks charge no extra fee when you travel abroad. They pass the MasterCard exchange rate directly, nearly matching the actual mid-market exchange rate.

	Name	Score	Visit	Disclaimer
	Monzo	8.4	Visitmonzo.com

Monzo was initially designed to be a full-fledged marketplace for financial products. Yet, life happened, and developers decided it wasn’t a viable roadmap. That doesn’t mean that they don’t have integrations with third-party applications, but they are not easily located.

Starling’s marketplace comprises nine providers, spanning six categories: investments, pensions, mortgage brokers, credit scores, insurance, and cashback providers, like Tail. These apps directly integrate with Starling – you can, for example, round up your payments to send every extra penny to your ISA account with Wealthify.

• If you'd like to stick to banks for your home loan, here are the best UK banks for mortgages.

Starling no longer allows purchasing cryptocurrencies using its cards, while Monzo still does. But it’s not possible to do so directly through the app, as with Revolut.

	Name	Score	Visit	Disclaimer
	Starling Bank	8.5	Visitstarlingbank.com

Both banks snap an ‘Excellent’ rating of 4.3/5 on Trustpilot with similar proportions of 5-star and 1-star reviews.

Both Starling and Monzo users appreciate the slick interface, innovative features, and easy account-opening processes. Many users find fee structures easy to understand and fair, and there are plenty of positive remarks about using the cards while travelling.

Monzo’s negative reviews mostly revolve around the incompetency of customer service. Many noted that customer service is fairly hard to reach, and disputes simply take too long to be resolved.

Starling users are not entirely satisfied with the business account opening process and requirements, and there are several complaints about technical issues. Many found the business account application procedure cumbersome, while some complained that due diligence is extensive. Nevertheless, we liked that the Starling team took the time to address each query with a personalised message and take further action to resolve the issue if need be.

	Name	Score	Visit	Disclaimer
	Starling Bank	8.5	Visitstarlingbank.com

	Name	Score	Visit	Disclaimer
	Monzo	8.4	Visitmonzo.com

And there you have it – after closely examining the features, account types, additional offerings, and customer feedback of both Starling and Monzo, it's clear that Starling emerges as the winner. Its versatile range of features and low-cost services set it apart from Monzo.

However, Monzo isn't far behind, excelling in savings, spending and sending money abroad, and lending. We found that while Starling makes the most out of its app and its place within the larger fintech network, Monzo provides a rather more holistic banking experience close to its traditional rivals.