U.K.-based digital bank Monzo has announced the launch of an investment feature, allowing customers to invest in multi-asset funds from asset management firm BlackRock (NYSE:BLK). Starting today, customers can join a waitlist to invest amounts as small as £1 ($1.25) into one of three different funds.
The new feature, which comes after 18 months of building out its wealth arm, marks Monzo's latest move towards longer-term profitability. The neobank, which boasts around eight million U.K. customers, aims to simplify investing with a user-friendly smartphone app interface and low entry-level investment amounts.
Investors can choose between three profiles named 'careful', 'balanced', and 'adventurous', each representing different levels of risk. The investment feature includes a fee of 0.59 percent of the investment value, which comprises a 0.14 percent fund fee for BlackRock and a 0.45 percent platform fee for Monzo.
Monzo CEO TS Anil expressed his enthusiasm for the new product, highlighting its potential to make investing more accessible. "I’m so excited to get this product into the hands of customers at a time we know they want to invest in longer-term financial goals but don’t know where to turn or how to get started," he said.
Further emphasizing the importance of this development, Anil added: "This is an important next step on our mission to make money work for everyone as we put the Monzo stamp on another corner of finance that is perceived as complex and inaccessible."
Monzo's decision aligns with a YouGov poll commissioned by the bank indicating that over half of respondents would feel more in control of their investments if they could track their spending, saving, and investing all in one place.
The launch comes amid Monzo's ongoing efforts to reach annual profitability. The bank reported a loss of £116.3m for the year up to March 2023, a slight decrease of 2 percent from the previous year. Despite this, Monzo maintains that it is on track to achieve annual profitability.
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