Monzo has recently moved the investment account into its short-term goals.
They specified that the accounts will be with 3rd party providers. Given many similarities with Freetrade in the way the organisations operate, would it not be interesting to see of a joint cooperation is even theoretically possible?
Many people of generations Y & Z (mostly the latter) are now switching from High Street to Fintech seeking flexibility, adaptability and quick development that does not need to get the approvals of 300 internal corporate governance boards but rather simply does the work!
Being a Monzo customer myself, I would be quite interested to see if they could synergise with Freetrade.
If be very keen to see Freetrade linking up with Monzo too. It seems like theyād be a great match in terms of their values as well.
Yesterdayās update about their pricing included a mention of a Freetrade ISA. Perhaps an integration with Monzo could enable users to move their savings to that ISA, if it was set up. Weāve already seen Monzo trialling integrations with investment providers in their alpha version of the marketplace.
You could even use Coin Jar to create a similar setup to Moneybox & sweep spare change to Freetrade. But with the added benefits of lower fees & the ability to choose exactly what that moneyās used to invest in
P.S. - Monzo said that they removed investments from their marketplace because the UX wasnāt good enough. My guess is that, thatās because userās were redirected to providerās websites where they still had to work their way through a clunky application process because they could invest.
Iām hopeful that Freetrade will make their signup process much simpler. And since theyāre building a full stack platform, perhaps they will be able to build deeper integrations with providers like Monzo & Starling too..
Even a stop gap for now, something like a pot that shows your freetrade portfolio (or even just the value) but you have to click a link and it opens the freetrade app.
A Monzo integration makes a lot of sense, Monzo partnered with Moneybox but that costs you 0.45% pa whereas you could invest in the exact same funds with Freetrade but it would be free!
It may not have have a round up the change feature, but you could have a regular payment instead, I believe Moneybox takes a weekly payment anywayā¦
Yeah thatās right, last time I checked Moneybox keeps a running total of your āspare changeā and then takes it as a lump sum. Would be much more efficient if it could all be done real time so you donāt see it, or at the least, taken from a specified pot ie. the Coin Jar
You are probably right. Just sharing that they are different in some ways and the explosive growth between last years raise and this year was partially due to cryptocurrency hype. Revolut is coolā¦
Revolut is available in the entire Europe whereas Monzo is UK exclusively. One thing I am suspicious about Revolut is that they try to chew a lot up and the whole system may fail if they do not manage to control it. Which is why sometimes you may prefer a steady growth in a single area you are expert in (Freetrade/Monzo) instead of consolidation.
Simonās shared a screenshot from the live(ish) counter on Monzoās homepage there btw - in case anyone reading this later wants to check how many users Monzo has then
Now that they have a cash saving product available as a pot, we recently had a discussion over on Monzo about a Stocks and Shares pot. As an investor in both, Iād be really keen to see this at some point - personally I think it could really help boost Freetrade growth, particularly with those who have little interest in investing, though I completely understand it wonāt be a priority for Freetrade right now.
The savings pot is interesting as itās using the Monzo onboarding and user verification to make it a pretty much one-click process to open a savings account. I think Freetrade could do something similar and provide one-click access to a simplified account, while leaving the customer open to downloading the Freetrade app later and managing their investments in a more involved way, so it would be a win for Freetrade if there is a large base of Monzo customers who have never thought about investing in the stock market. I believe there is.
I did make reference to that in my previous Monzo thread.
I think itād be a great way to supercharge user growth (when readyā¦ there is still 70k people on the waitlist). With that said, I donāt really know about revenue share in such a partnership and it could cause unit economics to fall. Iām sure the folks at @freetrade_team are exploring all avenues.
I evidently have too much time on my hands, so cross-posting (I hope thatās okay) something I was posted on the Monzo forum about integrating the apps:
Thereās been talk over on the Stocks & Shares Pot thread about seeing this type of information in Monzo. Freetrade was mentioned, and Iāve been thinking about how an integration with Freetrade might work.
Hereās the pitch:
Monzo + Freetrade = highly complementary
Monzo can unlock 1m+ additional users for Freetrade - when Freetrade is ready for them. FT can then monetise a large part of this market when they launch chargeable ISAs and Alpha (their monthly subscription product).
Freetrade can help Monzo in demonstrating a tight integration between the apps, and make the financial hub concept come to life. This data and demonstration will be valuable in attracting additional partners.
But Freetrade + Monzo can be more than the sum of their parts. What if they offered a set of pre-selected investment products that they user didnāt have to actively manage - a bit like Nutmeg - bought in a couple of taps from within Monzo? This doesnāt dilute the Freetrade proposition and a small mark-up and revenue share means that this might be a lucrative revenue stream for both companies.
Freetrade could do with better banking services - and live cash transfer from external bank accounts. Monzo could provide back-end banking services to Freetrade - for example by giving each Alpha customer a sort code and account number - making the lag of sending money to Freetrade a thing of the past, generating revenue for Monzo and making Freetrade slicker.
What would it look like in the Monzo app? :monzo:
New āinvestmentā section in the new Account tab
From there, existing Freetrade customers see their Portfolio as an aggregated view. Tap to breakdown - still within Monzo - then when selecting individual stocks it takes you seamlessly to the right screen in Freetrade.
New customers get the ability to open a Freetrade account. Immediately with no hassle. App downloads in the background - Monzo shares KYC with Freetrade (with the userās consent, of course) and youāre already logged in and good to go.
As a separate proposition within the Monzo app, users can tap to open a set of pre-prepared funds. Available exclusively within Monzo so not to dilute the Freetrade share-dealing proposition, charging a small commission would generate revenue for both companies.
How would they make money?
No cost to either party of showing existing Freetrade customer data within Monzo - this part of the integration just helps both companies grow
Assuming Freetrade sees value in growing its freemium customer base, Freetrade pays Monzo a referral fee for each account opened from within Monzo (Ā£5, say).
Similarly Freetrade customers opening a Monzo account would net Freetrade Ā£5 (same incentive as for the other Monzo account opening trials).
For the pre-selected investment products, Monzo and Freetrade each take a mark-up of 0.25 - 1%
Monzo charges a monthly fee to provision bank account services to Freetrade alpha customers (call it Ā£1/month)
(Note: all these figures are guesses and based on no real research)
This would lead to an ongoing, mutually beneficial commercial relationship, I think / hope.
What does everyone think? Is this an interesting model for folks like Monzo and Freetrade to look at?
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