Monzo business overdraft: what limited companies can get

Monzo offers limited companies an overdraft of £500 to £5,000 on a Monzo Business account, with an annual fee and a personal guarantee from the director who applies. If your company needs more than that, or Monzo can't offer one, you can borrow from another lender and keep your Monzo account.

Monzo's own site says that where it can't help a limited company with a loan, it has teamed up with iwoca. A Monzo customer who needs more than an overdraft doesn't have to switch bank to get it.

‍

How a Monzo overdraft works for a limited company

Monzo's limited company overdraft is an arranged overdraft you switch on in the Monzo app, separate from its personal overdraft. We checked the terms on Monzo's UK pages on 12 October 2026.

Monzo Business is an app-based business account, and Monzo says more than a million UK businesses bank with it. The overdraft comes with its own limit, fee, and rate, set out below:

Sources: Monzo business loans and overdrafts and Monzo help: getting a limited company overdraft, checked on 12 October 2026.

Monzo takes the annual fee from your account when you switch the overdraft on, whether or not you go on to use it. Interest is calculated daily on your overdrawn balance and taken on the first day of each month, so the overdraft costs less the sooner you clear it.

A personal guarantee means the director who signs could be personally responsible for the debt if the company can't repay. It's worth reading the terms in the app before you accept.

‍

When a Monzo overdraft is enough, and when you might need more

A Monzo overdraft suits short, occasional dips you can clear quickly, and you manage it in the same app as your account. It's less suited to gaps bigger than £5,000 or borrowing you'd rather repay over months.

It's likely to fit if:

• Your gaps are small and predictable, such as a small supplier payment due a few days before a customer pays.
• You'd usually clear the balance within the month.
• You want to see your borrowing and your account balance in one place.

You might look further if:

• You expect to need a bigger limit as the business grows.
• You'd rather repay in fixed instalments than carry an overdrawn balance.
• Monzo can't offer your company an overdraft, or the yearly fee and credit check don't suit you.

High street banks also offer business overdrafts, often with bigger limits, though many only lend to companies that already bank with them. Lending appetite is tighter than it was: in iwoca's SME Expert Index for Q2 2026, 75% of brokers agreed that high street banks are reducing their appetite for funding small businesses.

‍

{{alternative-lenders-blog-cta="/seo-components"}}

‍

Borrowing from iwoca while you keep your Monzo account

You don't have to move your business account to borrow more than a Monzo overdraft allows. iwoca lends to limited companies whichever bank they use, and since 2012 we've lent £5bn+ to 100,000+ businesses.

Monzo introduces some of its limited company customers to us. To be open about it, Monzo earns a commission when it does, and it says this doesn't affect your application. You can also apply to iwoca directly.

The iwoca Flexi-Loan is a business loan with flexible repayment options. It can cover amounts a Monzo overdraft can't:

• Borrow £1,000 to £1m, depending on your company's finances.
• Spread it over up to five years if you need longer than an overdraft gives you.
• Pay interest only on what you've drawn.
• Keep your Monzo account, with the money paid into your business bank account.

You apply online, and you'll usually get a decision within 24 hours. We lend to UK limited companies.

Every new Flexi-Loan needs a personal guarantee from at least one director, though not every director has to sign. It's the same kind of commitment as the guarantee on a Monzo overdraft. You can repay early at any time with no early repayment fee.

For many small businesses, cash flow isn't the same month on month. Chris Billingham, founder of Muscle Squad, borrows in step with his sales cycle: 'We go through waves of borrowing a significant amount and paying back a significant amount. You need the conviction that a good period is only around the corner.'

If the dip is small and you'll clear it within days, the overdraft on your Monzo account may be the simpler choice.

‍

Monzo business loans and credit cards for limited companies

Monzo also offers business loans to limited companies, but it doesn't offer a business credit card.

Directors can check in the Monzo app whether their company is eligible for a Monzo business loan. The company needs to have held its Monzo Business account for at least 30 days, and the director gives a personal guarantee. Monzo's representative APR for limited company loans between £500 and £35,000 is 33.1% (Monzo business loans and overdrafts, checked on 12 October 2026).

Monzo's business expense cards are debit cards: the money comes straight from your business account balance, and they come with the Team plan, from £25 a month (Monzo expense cards). If you're after a credit card for business spending, the iwoca Credit Card gives cashback on every £ spent.

‍

Frequently asked questions

How do I set up a Monzo business overdraft?

You set up a limited company overdraft in the Monzo app, and the option only appears if Monzo can offer you one:

1. Tap the Home icon.
2. Tap the ellipsis (…) menu on your account overview.
3. Tap Learn about overdrafts, then follow the steps.

Once it's set up, you'll find it under Manage your overdraft.

‍

Does applying for a Monzo business overdraft affect my credit score?

Applying leaves a hard search on your company's credit file, which can affect its score, and a soft search on the applying director's personal file, which doesn't. Monzo runs another hard search on the company each year when you renew.

‍

Why won't Monzo give my company an overdraft?

Monzo decides using your company's credit data, and it doesn't publish a full list of reasons for saying no. It's worth checking the basics first: only a director with admin access to the account can apply, and Monzo offers one overdraft per company.

‍

Can I reduce or switch off a Monzo business overdraft?

You can reduce or switch off a Monzo business overdraft at any time, as long as your account isn't overdrawn when you switch it off.

If you change your mind within 14 days of switching it on, Monzo says you may be able to get the arrangement fee back (Monzo help: switching off your limited company overdraft).

‍

Do other app-based banks offer business overdrafts?

Other app-based banks are unlikely to give you a bigger overdraft. When we checked on 12 October 2026, Revolut Business didn't offer overdrafts in the UK, and Starling wasn't accepting applications for business overdrafts or loans.

‍

{{calculator-cta="/components"}}