the times | Tuesday October 20 2020 1GM 43
Business
Monzo, the digital bank, is following in
the footsteps of the big high street
names by launching a packaged
account.
For a fee of £15 a month, the Monzo
Premium account will pay an interest
rate of 1.5 per cent on balances up to
£2,000, and provide phone and travel
insurance.
It is Monzo’s second account launch
in four months, after starting its Plus
account back in July. The Plus account
has a monthly fee of £5 and an interest
rate of 1 per cent on current account
balances up to £2,000. By comparison,
the top instant access savings account is
offered by Coventry Building Society
and pays a rate of 0.96 per cent.
Packaged accounts have been popu-
lar among mainstream banks for years.
The Halifax Ultimate Reward account
has a £17 monthly fee and gives custom-
ers the chance to earn cashback with
certain transactions. Nationwide’s
FlexPlus account comes with family
travel, smartphone and breakdown
insurance, for a fee of £13 a month.
Monzo has won 4.4 million customers
since securing its bank licence in 2017.
However, the start-up, which was
founded in 2015 by Tom Blomfield,
Jonas Huckestein, Jason Bates, PaulAmerdeep Somal
is taking over as
the complaints
commissionerMonzo follows big lenders with packaged account
Rippon and Gary Dolman, has report-
ed widening losses, of £114 million in the
year to the end of February, and warned
in its annual report that “the ability of
the group to continue as a going
concern is subject to material uncer-
tainties”.
Andrew Hagger from Money
Comms, a financial advice website, said:
“I don’t think the Monzo account is
very exciting. The bank is probably try-
ing to get some regular fee income with
a subscription service, and if you com-
pare it to the best packaged accounts on
the market, it falls a bit short.”
Mr Hagger said the bank was prob-
ably trying to lure people in with the
1.5 per cent rate, even though it
amounts to a maximum of just £2.50 a
month. He also pointed out that few
people would be making use of travel
insurance given the Covid restrictions.
“It’s really just another packaged ac-
count. You almost expected Monzo to
come up with something a bit different.
I thought they might be a bit more
innovative, but it hasn’t really got any-
thing new in it,” he said. While Monzo’snew account has similar features to the
Plus in that they both offer monthly
credit score updates and can pull infor-
mation from other banks, the insurance
deals are an added feature.
Travel insurance with Axa covers
customers and their families for holi-
days in the UK and abroad. This covers
medical bills up to £10 million, lost valu-
ables up to £750, and cancellation costs
up to £5,000, all with an excess of £50.
The phone insurance is with the in-
surer Assurant and covers customers
for loss, theft and accidental damage on
phones worth up to £2,000.
Mike Hudack, chief product officer
from Monzo, said: “This is on top of all
the extra features in Plus that give sub-
scribers complete visibility and control
over their money.”
He pointed to a report from the
research company Consumer Intelli-
gence, which estimated that the com-
bined annual value of Monzo Premium
insurance is £256 a year. With fees of
£15 a month, Hudack said the Premium
account could save customers about
£80 a year on insurance alone.Katherine Denham Money Reporter
Monzo, co-founded by Tom Blomfield,
has launched two new accountsRegulator review
over Connaught
nears conclusion
tory failure.
Capita Financial Managers, a former
unit of Capita, the outsourcing group,
was censured in 2017 for its manage-
ment of the Connaught fund. It agreed
to pay £66 million to fund compensa-
tion for investors.
Mr Parker is not expected to address
the question of whether redress should
be paid. However, if, as expected by in-
vestors’ representatives, the report is
critical of the regulator, it will prompt
calls for further compensation.
Antony Townsend, the complaints
commissioner, who has been critical of
the FCA’s shortcomings, is due to step
down at the end of the month.
Any calls for compensation arising
from the Capita review, or from sepa-
rate independent reviews into the regu-
lator’s handling of a small business mis-
selling scandal and the collapse of the
minibond firm London Capital & Fi-
nance, could end up with the new com-
plaints commissioner, Amerdeep So-
mal.
Ms Somal will step down from roles
as independent assessor of the Finan-
cial Ombudsman Service, a member of
the General Medical Council and a
senior independent panel member for
public appointments at the Cabinet
Office.
The Connaught review period covers
the first two years of the FCA’s exis-
tence, although the Connaught
Action Group, which represents
some investors, said it should
have encompassed the period
up to the present day.
Mark Bishop, of the Con-
naught Action Group, said:
“Unless the review is a white-
wash I believe it will find ex-
tensive regulatory failure. The
costs of that fail-
ure... should be met by
the regulator.”An independent review into alleged
regulatory failings surrounding the col-
lapse of a fund that lost investors more
than £100 million is almost complete.
The investigation into the City
regulator’s handling of the demise of
Connaught Income Fund Series 1 is
concluded bar final checks, including
offering a right of reply for those criti-
cised in the report, paving the way for
publication as soon as next month.
Connaught was a collective invest-
ment scheme that started operating in
2008, providing short-term bridging
finance to commercial operators in the
property market. It claimed it could
offer returns of more than 10 per cent.
In 2011 Tiuta, a bridging loan firm in
which the Connaught fund had placed
investors’ money, became financially
strained. Connaught went into liquida-
tion in 2012, leading to more than £100
million of losses for about 1,900 people.
The Financial Conduct Authority
was formed in 2013. Its predecessor, the
Financial Services Authority, was
accused of being slow to react to
evidence of problems, including
warnings from a whistleblower about
accounting irregularities at Tiuta.
The review, led by Raj Parker, a
barrister, is understood to be in “Max-
wellisation’” — the term for the prac-
tice of sending proposed criticisms
of an individual or organisation
to them for comment. Parties
have received redacted ex-
tracts of the report and have
been given until today to re-
spond.
The Office of the Com-
plaints Commissioner, which
rules on complaints about fi-
nancial regulators, con-
cluded in 2016 that a
“major inquiry” was
required to establish
whether compensa-
tion should be paid
and if there had
been serious regula-James Hurley Enterprise Editor
provide a new sciences building with
the university’s departments of
zoology, plant sciences and
experimental psychology.
The new Life and Mind Building
will be the largest building project
ever undertaken on behalf of the
university, and its biggest teaching
and research facility, aimed at
improving the way that
psychological and biological tuition
is undertaken in Oxford.
Founded in 1836, Legal & General
is one of Britain’s biggest pensions
and savings companies and is a
member of the FTSE 100, with a
market value of more than
£11 billion. It manages £1.2 trillion of
people’s savings. It is also an
infrastructure investor and
housebuilder, owning the Cala
Homes brand, and a modular
housing business
The L&G investment with the
university comes after a £4 billion
partnership announced in June last
year to form Oxford University
Development, to provide thousands
of new homes for staff and students,
as well as a number of other
facilities.
The new Life and Mind Building
will provide laboratories, lecturetheatres and opportunities for
public events.
Nigel Wilson, chief executive of
Legal & General, said: “The Life
and Mind Building will provide
students with a modern, state-of-
the-art facility that helps continue
the University of Oxford’s legacy as
one of the world’s most pre-
eminent teaching institutions.”
Professor Louise Richardson,
vice-chancellor of the university,
said: “This fabulous building will
provide innovative facilities for
teaching and research, which will
enable Oxford to train a new
generation of scientists who, in
turn, will help us to address critical
global challenges.”GEOFFREY SWAINE/SHUTTERSTOCKGet up to speed in
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A student celebrates the end of exams
at Oxford, where a new life and mind
sciences building, top, will be built
using funds from Legal & General