Digital bank Monzo is entering the mobile market with a phone plan that decreases in price each year a customer remains with the service. The plan, built on the Virgin Media O2 network, will be available from summer, with a waiting list now open for Monzo customers.
Monzo, which has over 15 million customers, said its plan rewards long-term loyalty by offering a 5% discount on the monthly bill each year, up to a maximum of 30%. Three digital SIM-only plans are available, priced at £8, £12, and £20 per month, with varying data allowances.
The move intensifies competition in the UK mobile market, which is already facing challenges from newer players like Revolut and Klarna. Since 2025, new rules have banned mid-contract price rises without warning, but some providers have faced criticism for inflation-linked increases that penalise loyal customers. Monzo's plans are no-contract with no exit fees, though the bank can still change prices at any time.
Monzo joins a growing number of virtual network operators that piggyback on the four major UK networks—EE, Virgin Media O2, Vodafone, and Three. Financial firm Revolut launched a similar service earlier this year on the Vodafone network, offering unlimited 5G for £12.50 a month.
Jez Samuel, mobiles expert at Uswitch, said Monzo's loyalty discount “isn’t breaking new ground” but noted that “broader adoption is a positive sign.” He added: “We’re seeing more players enter mobile than ever before, which can only mean more choice for consumers. Flexible, no-contract plans are appealing, but that flexibility cuts both ways as Monzo can change the price of its plans at any time.”
