Digital bank Monzo has announced the return of a hugely popular feature for its UK customers, offering a simple path to save more than £660 in the coming year. The Monzo 1p Saving Challenge is back for January 2026, following a successful run in 2025 that saw 1.2 million participants collectively save a staggering £308 million.
How the Monzo 1p Challenge Works
Eligible Monzo account holders can sign up for the challenge directly through their app, which will instantly create a dedicated 'Challenge Pot'. The savings plan lasts for 365 days, starting from the moment a user saves their first penny. The mechanism is ingeniously simple: on day one, the pot automatically receives 1p. On day two, it adds 2p, on day three, 3p, and so on, culminating in a final deposit of £3.65 on the last day.
By consistently following this incremental pattern, anyone who completes the full year will amass a total of £667.95. The feature is designed to make saving painless, building a substantial sum from seemingly negligible daily contributions.
Boost Your Savings with Interest and Premium Accounts
All savings within the Challenge Pot will earn interest. Monzo confirms the pot accrues interest at a rate of 3.25% AER (variable), paid into the pot on the first day of each month, provided the balance is at least 1p. The bank notes that this rate is variable and subject to change.
For customers with a premium Monzo account, the benefits are even greater. These savers can earn a boosted 5% interest on their Challenge Pot. Monzo states that this premium rate could add an extra £33 to the final total for those who finish the challenge, pushing the overall savings comfortably over the £700 mark.
Security, Eligibility, and Next Steps
As with all Monzo accounts, customer deposits are protected under the Financial Services Compensation Scheme (FSCS) for up to £120,000 per person. Once the challenge concludes, users have full flexibility: they can continue saving, explore investment options, or simply transfer the funds to their main Monzo account.
Monzo has also indicated that to be eligible for any associated prize draws, customers will need to have started their challenge before 31 January 2025. The return of this feature underscores Monzo's focus on creating engaging tools to promote financial health among its millions of UK customers.
