Starling vs Monzo

There have been a number of these cool digital Challenger banks coming along. As with one great product, there will always be a competitor for that product. I.e. iOS vs Android, Coke vs Pepsi… in the modern age I would consider Starling as one of the big challenger banks out there. Followed by Monzo. There are certainly a number of them (Revolut, N26 etc) however I would consider Starling and Monzo to be the big banks out there now, similar to HSBC vs Lloyds.

I’ve applied for a bank account for both of them, first one was Monzo Bank and then followed by Starling. I must explain that I thought Monzo was a fantastic idea when I first heard about it. It was still in the Beta stage, so overall it was a prepaid card back then. The main reason I got it was that my fiancee travelled to China for business quite a lot, and we had a big holiday coming up at the end of the year to go to Japan, Seoul and Hong Kong. The costs do add up eventually if you withdraw money/spend a lot overseas. These 2 challenger banks have the option to withdraw money and spend overseas so immediately they’re much better than normal banks.
They also have real time transactions (unlike your traditional bank which can take a few days to update), and the ability to break down how your money was spent. Overall these are rich in features and have embraced the way the young and digital peeps use their money. I for one love these challenger banks. I’ve loved the way they created a system that is modern and gets with the times rather.
The main question for this though is which one is the better bank to go with? It’s quite a tough question but I’ll try to break it down to who’s the better candidate. We’ll rate them as shown below:

Applying for an account

I applied for Monzo ages ago while it was still a Beta system. They had a waiting list , even back then, and still continue to have it unless you have the coveted golden ticket to skip the waiting list. Starling do not have it. In fact they sent me the card in 2-3 working days. Monzo took maybe 3 weeks in total.

From a sole application point of view, both are very similar. They both have a simple ID process in which you record a short video to prove you are who you are, and then some photo id. It’s a straightforward and simple process. So they are tied in that way, but the waiting times may shift it towards Starling more.

UI

I used Monzo first, and then got Starling nearly a year later. This has to be where Monzo really shines, the User Interface of the app is gorgeous. It’s very hip, it’s got great UI effects and animations (i.e. the card freeze) and a very simple menu layout.

Starling’s UI needs a bit of polishing as the purple hue for the spending overview looks a bit monochromatic and dull. Starling’s stuff isn’t as intuitive as Monzo for new users, however that’s not to say that Starling are awful. They focus more on the core functionality with a decent enough UI. One area where they excel (not necessarily a UI thing) is that their Goals feature has a nice UI and allows you to add your own pictures - I will cover this in a separate point. This gives the lead to Monzo for its polished efforts in iOS.

*Sidenote, I’ve read that some users mentioned that iOS get features first before Android. Not a problem for me but might be a problem for you Droid fans out there.
Everyday banking functionality

Everyday spending:

Starling gives you an overview of what you spent your money on that day broken down in a donut chart. This is handy for everyday spending, along with the handy way you can categorise purchases. Starling has a lot more categories than Monzo (no idea why) so it makes it a bit easier to track certain things. For example, I want to know how much I spend on pet food so I can track it against my budget. In terms of Starling you can have a category for pets, but with Monzo: there is none.

Monzo has the concept of targets, which allows you to put a monthly figure and calculate based on your spending: how much do you have left to spend on that category. Bear in mind though that because there isn’t as much categories, you will need to get creative with what you class your purchases. This is a feature missing from Starling that it could sorely do with.

Realtime notifications

Starling also gives you that real time notification of spending, however I have experienced a bit of lag before with updates on what I spent there and then. It could have been a network issue, however it’s worthwhile pointing this out that it wasn’t as fluid as what Monzo’s experience is like.

Monzo also has some other subtle but nice features, such as whenever someone transfers money or when you buy something, the notification sound is coins clinking. This once again is part of the UX (User Experience) that Monzo worked hard on crafting.

Interest

Well this one is simple - Monzo has none, Starling gives 0.5% interest and that includes on the money that you have in your goals saved up.

Security

Both apps in iOS use FaceID/TouchID and also have the ability to lock the card and retrieve pin. They also both include geo location spending limits (i.e. can’t be used in certain countries if you chose to).

Apple/Android Pay integration

At the time of starting this post, Monzo didn’t have Apple Pay - but they finally gave Apple Pay to us. This one is definitely tied, otherwise that would have been another win in Starling’s camp.

Travelling with both

I’ve yet to travel with the Starling card but the thing that caught my attention was something that Monzo sort of imposed onto customers after I travelled.
Monzo used to have no limit on ATM withdrawals abroad, but have since capped that monthly to £200 with a 3% charge thereafter. Starling has not required this and still gives unlimited ATM withdrawals.
Monzo has the option to use Magstripe ATM which is handy for places like China and America. I have yet to see this on Starling but with a quick browse on Google, it doesn’t seem like it’s much of a problem for Starling. It just seems like you can use it and not have to worry about it.

When I did travel to Hong Kong, Seoul and Tokyo: the Monzo card worked perfectly. Saved me a bit in Tokyo as it’s still predominantly a cash-full society. Not many places take cards, apart from maybe 7-11, department stores etc. Some restaurants don’t accept card so it was very handy to be able to withdraw money (at the time no limit) without fail. It worked fantastically. In Seoul it was a mixture of contactless and chip and pin. Hong Kong, exactly the same.

I will travel with Starling soon, but for now I’d say this one is a tie solely based on the fact they do the same, with a slight favour to Starling for no withdrawal limit abroad.

Savings feature

This is where Starling shines. So in the old days you’d need to have a current account and then start up a savings account (separate number, separate bla bla) and then set up a standing order to automate your savings to it. In the digital age it feels like such a faff. It can take roughly 5-10 mins to apply for this, where as in the Starling way it takes literally seconds.
You set up a Goal, manage it and put a target in (target amount) and then if you want to, you can set up monthly recurring payments into those goals to help automate your savings. This to me is genius because it’s like you’ve paid yourself before you have to do other things with your hard earned money. As a person who likes money management, this is a fantastic way to do it. I used to have to start up multiple savings account for different things (i.e. Holiday account, wedding account, car fund account, annual account), but with Starling Goals it’s so simple, I just add one bit and save away without needing to open a new account or set up standing order in the old way. Best part is you can assign your own picture to the goals as well to make it fun.

Monzo has a very similar feature but their’s is called a pot. The only difference is you can’t set up regular payments to it (boo!) and you can’t choose a custom image, only the preset images you have available.
They both have savings facilities but my hat has to go with Starling because of the richer functionality plus that they give 0.5% on money in your goals. It’s simplified my life a lot more.

Perks

Simple this one - Starling gives 0.5%. Monzo doesn’t.

Conclusions

So far for the everyday banking and organising that I do, my conclusion has to go towards Starling for the richer features available. Monzo is still a very worthy contender, and definitely one to consider for the younger generation since they will absolutely love the cleaner UI and the fact that it’s quite hip. Starling itself feels more grown up and bank like. For the awesome Goals feature and automated payments, I can’t recommend it enough.