The UK’s Competition and Markets Authority (CMA) letter to Monzo focuses on issues related to the digital bank allegedly breaching Parts 3, 7, 8 and 12 of the Retail Banking Order.
CMA finds breaches of Parts 3, 7, 8 and 12 of the Retail Banking Market Investigation Order 2017 and Monzo has now reportedly “agreed to take action to prevent a recurrence.”
Part 3 of the Order requires surveys to be carried out of Personal Current Account (PCA) and Business Current Account customers about the quality of service received from their provider. On 2 occasions Monzo has reportedly published “incorrect / out of date survey results.”
Part 7 of the Order requires providers to specify, for each PCA product they offer, the “maximum unarranged overdraft that could accrue for that PCA product in any month.”
As noted in the update, providers must disclose this information each time information relating to “unarranged overdraft charges is disclosed and no less prominently than the presentation of that information.”
On four occasions Monzo has allegedly failed to release the required information “where it should have been published.”
Part 8 of the Order requires providers to publish “representative rates in either the Annual Percentage Rate or Equivalent Annual Rate for lending products for small and medium-sized enterprises.”
It also requires that additional contextual information “is published to explain the rates.”
Monzo has reportedly failed to release this information for “one loan on its business banking website and in one marketing document for a financial promotion.”
Additionally, the additional contextual information “required by the Order was not published on Monzo’s website.”
Article 56.2 in Part 12 of the Order requires providers to “notify the CMA of any non-compliance with the Order within 14 days of becoming aware that it is not compliant.”
Monzo had reportedly failed to notify the CMA of “three of the breaches set out above within 14 days of becoming aware that it was not compliant, instead taking 5, 6 and 9 months respectively.”
In addition to this, Monzo‘s social media presence is not very meaningful or informative. For instance, on LinkedIn, the company hardly ever shares any important details regarding their product updates or even any insights from their professional team. The company also does not release regular and professional press releases which is standard practice in the industry. These issues make it challenging to keep up with what exactly Monzo is doing and what it plans to offer.
