Monzo Bank Ltd · DRN-6293801

The complaint Mr D complains about Monzo Bank Ltd closing his account without prior notice and were unhelpful in allowing him to repay his lending. He’d like them to provide details on how he can repay his balances, and to pay compensation. What happened Mr D banked with Monzo. But in June 2025 Monzo blocked his account, without warning or explanation. They later wrote to say they would be closing his account in 62 days’ time – but the account was instead closed on 1 July 2025. Monzo wrote to Mr D about the outstanding balances on his flex account. Mr D asked for details on how to repay this, and his loan. But Monzo wouldn’t provide these details until he had told them the source of his funds. Dissatisfied with what had happened Mr D complained to our service. He also felt Monzo were still withholding some of his funds. At this point Monzo accepted the notice period suddenly changing would have caused some distress and offered £50 in compensation. Mr D rejected this, but our investigator didn’t see Monzo needed to do anything further. She felt Monzo had acted within their terms in the manner they’d closed Mr D’s account. She didn’t think it was unreasonable for Monzo to ask for the source of funds. She also felt the outstanding amount Monzo held seemed to relate to a business which Mr D was no longer involved in. Mr D didn’t accept this, and as such the complaint has been passed to me to decide. What I’ve decided – and why I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. Having done so, I’m not persuaded Monzo need to do anything further here. I appreciate Mr D will likely find this disappointing, but I’ll explain why. Monzo have to meet a number of legal and regulatory obligations when providing accounts to their customers. These can broadly be described as a duty to monitor their accounts and account activity, to better understand how they are being used. And to combat the risks of financial crime, such as fraud or money laundering. Monzo also have a broad commercial discretion into who they provide accounts to, and on what terms. It would be rare for our service to say Monzo ought to have continued to provide an account, when they’ve decided to end the banking relationship. Instead, we’d look to see any closure is in line with the terms of the account. Here Monzo initially gave 62 days’ notice – although in practice the account had been blocked already. And in any event, they later decided to close the account immediately. The

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terms state this can only be done in very limited circumstances. Monzo haven’t explained to Mr D their reasons for closing his account in detail, and there is no specific obligation on them to do so. But they have provided more information to our service about their concerns. The rules of our service allow me to treat certain evidence as confidential, for example if it contains information about internal security processes, or from third parties. While I’m sure Mr D would like to know more information, I see it’s appropriate I treat this further evidence as confidential. I appreciate this isn’t ideal, and I can’t give as much detail as I’m sure he would like. But Monzo’s decision to close his account was a reasonable decision they were entitled to make, and in line with the terms. Mr D has said Monzo refused to give him details on how to make repayments to his outstanding balances. Reviewing the correspondence between the two, I can see Monzo have said they require him to explain where the funds will be coming from, and any bank statements to demonstrate this. Considering the nature of the closure of the account, and the overall circumstances I see this was reasonable. I’m not persuaded this would be too onerous for him to provide. So, I’m not minded Monzo would be responsible for any impact on his credit file from this. From what I’ve seen the remaining funds held were released within a reasonable time. Mr D has highlighted an amount of £50.57 which hasn’t been returned. But Monzo have shown this was held in the name of a limited company of which Mr D is no longer the director. So, I’m not persuaded Monzo need to release these funds to him. Monzo have offered £50 to reflect the distress caused by the change in notice period. Mr D has declined this, but considering the overall circumstances here and the concerns ultimately led to the closure of the account it wouldn’t be appropriate for me to direct Monzo to pay this. If Mr D decides he wishes to accept it, then he can contact Monzo directly. Here, I’m not persuaded that Monzo need to do anything further. My final decision My final decision is that I do not uphold this complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask Mr D to accept or reject my decision before 13 May 2026. Thom Bennett Ombudsman

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