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Barclays and Monzo

ended 08. March 2023

UPDATE: 09/03/23 12:05. Barclays have replied with the following:

"We can confirm that Barclays do accept mortgage direct debits from Monzo bank. This is a rare instance of a sort code being allocated that hadn’t yet been uploaded to our system. This prevented us from being able to verify and process the mandate instruction successfully. We apologise to both the broker and their customer for the confusion and inconvenience caused, and are taking steps to resolve the issue”

Jamie Lennox of Dimora Mortgages was told by Barclays today - see screengrab and Jamie's LinkedIn - that they won’t accept direct debits from a Monzo current account or any other online bank. He says his client will now have to either use a more expensive lender or open a new current account for the sake of one debit. Jamie said: “With the fintech banks all taking market share of the current account market, surely this policy is from the stone ages?” Free PR platform, Newspage, asked brokers for their thoughts.



 

12 responses from the Newspage community

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Benjamin Blyth
Director at Houz Mortgages
Question for anybody at Barclays: Why on earth not? Monzo is a legitimate UK bank with as good a banking licence as any great high street bank, such as NatWest or HSBC. I made the full switch to using Monzo as my primary personal current account several years ago, and have never looked back. They offer interest on my balance, an innovative app including many security features, and great rates on foreign currency transactions including withdrawing cash abroad. Looking at the range of dull current accounts on offer from Barclays Bank, which lack such features, I'd suggest not accepting Monzo is the result of some kind of jealousy of not being able to compete with Monzo's offering and to try and slow down Barclays' decline in current account market share.
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Jamie Lennox
Director at Dimora Mortgages
From a company that claims to champion innovation as part of its core values, you have to laugh. Given online banks have the exact same facilities such as direct debit payments, there are zero logical reasons why Barclays shouldn't be accepting their accounts for direct debits. As consumers increasingly move their banking to fintech firms such as Monzo, and with many of the big six closing countless branches at the same time, you do have to wonder how many customers they will lose. Things like this put unnecessary barriers in front of customers and aren't really in the spirit of treating customers fairly.
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Craig Fish
Director at Lodestone Mortgages
Some lenders are archaic and need to get with the times. There are a few lenders that won't accept my registration to submit business simply because my email address doesn't end with .co.uk! I had to set up another email address just so I could register.
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Rohit Kohli
Director at The Mortgage Stop
It's amazing how so many of the bigger banks are so far out of touch with both the way people want to bank these days and the technology that gives fintech start-ups the edge to move quicker in the industry. I'm sure that there will be something about AML reasons or such like that Barclays will say is driving this but given how many clients have accounts with banks such as Monza they need to catch up!
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Rob Peters
Principal at Simple Fast Mortgage
Barclays' criteria seems to be going from bad to worse. It was only a couple of weeks ago that they stopped allowing limited company business owners to assess affordability against the net profit from their companies unless the mortgage is above £1,000,000. Now they are sticking it to those who have embraced modern banking methods.
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Katy Eatenton
Mortgage & Protection Specialist at Eatenton Finance
I'm absolutely baffled that Barclays won't accept this. I'm sure I've used Starling or others in the past with them. If they don't, there's definitely grounds for a complaint here as it's not treating customers fairly at all by insisting they use certain bank accounts.
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Samuel Ewen
Managing Director at Rosehill Financial Services
My mortgage is with Barclays and my direct debit is taken from my Starling Bank account, so it's certainly not all online banks. However, not allowing a direct debit from online banks is a strange requirement to have, particularly where we're seeing many more clients with Monzo and other online bank accounts.
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Scott Taylor-Barr
Principal Adviser at Barnsdale Financial Management
At the rate that "traditional" banks are closing branches, aren't they all becoming online banks? What defines an online bank? First Direct doesn't have branches, so are they OK, or because they are owned by HSBC is that different? Starling Bank is an online bank and is busy buying financial businesses. Fleet Mortgage and Masthaven have been acquired by them recently. How big do they have to become before Barclays is OK with them? Which banks are Barclays OK with and which aren't they OK with?
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Gary Bush
Financial Adviser at MortgageShop.com
I think that the "old school" banks are feeling the pinch from the new breed and this appears to be a bite back at this situation! It's actually quite pathetic to try and take such an insular stance in today's progressing financial world. If only lenders' systems alerted us to these kinds of things on page one of their 30-page online processes!
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Amit Patel
Adviser at Trinity Finance
I have one question for Barclays: is this treating customers fairly?
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Rhys Schofield
Brand Director at Peak Mortgages and Protection
I've never known another lender or insurer have an issue with Monzo, who are brilliant in my experience. Maybe they're a bit scared of the new kid on the block who has much cooler stuff than they do?
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Graham Cox
Director at Bridging Hub
What a ridiculous policy from Barclays. Some of these legacy banks are still operating in the 20th century unfortunately. It's no wonder the challenger banks are eating into their market share.