Does Monzo Flex Improve Credit Score

Does Monzo Flex Improve Credit Score

Monzo Flex is a popular Buy Now Pay Later (BNPL) product that lets UK customers spread the cost of purchases into instalments. As the fintech market evolves, more people are turning to services like Flex to manage cash flow and budget more effectively. But one important question many Monzo users ask is: does using Monzo Flex improve your credit score?

The short answer is yes, Monzo Flex can help improve your credit score — if used responsibly. Like any credit product, how you manage repayments will determine whether it helps or harms your credit profile. In this article, we’ll explain how Monzo Flex works, how it affects your credit score, and what to keep in mind if you're using it to build credit.

What Is Monzo Flex

Monzo Flex is Monzo’s version of Buy Now Pay Later. It allows you to spread the cost of eligible purchases over:

• 3 instalments interest-free

• 6 or 12 instalments with interest (subject to your credit agreement)

It works like a virtual credit card and is available through the Monzo app. Once approved, you’re given a credit limit, and you can choose to “Flex” eligible transactions after the purchase or at checkout.

Monzo Flex is a regulated credit agreement, which means your activity is reported to UK credit reference agencies.

Does Monzo Flex Appear on Your Credit Report

Yes. Monzo Flex is a formal credit product, and your usage is reported to credit reference agencies such as:

• Experian

• Equifax

• TransUnion

This means your Flex account:

• Appears as a credit line

• Shows your credit limit and balance

• Records your monthly payments and payment history

• Tracks any missed or late payments

So while Flex doesn’t guarantee an improved credit score, it does give you the opportunity to build a positive credit history if used carefully.

How Monzo Flex Can Improve Your Credit Score

If you manage your Monzo Flex account well, it can contribute positively to your credit file in several ways:

1. Builds repayment history
Payment history is the most important factor in most credit scoring models. Making your Flex payments on time shows lenders that you’re reliable with credit.

2. Reduces credit utilisation
If you use Flex for larger purchases and keep your balance low in relation to your credit limit, it can help reduce your overall utilisation ratio — a key part of your credit score.

3. Adds to your credit mix
Having different types of credit (e.g. a loan, a credit card, and Flex) can demonstrate that you can handle a variety of credit responsibly.

4. Helps establish credit for new borrowers
If you’re new to credit or have a thin file, using Monzo Flex responsibly may help you build a solid credit history more quickly.

How Monzo Flex Can Harm Your Credit Score

While Flex can improve your score, it also carries some risks if not managed correctly:

1. Missed or late payments
Failing to make Flex repayments on time can result in late payment markers on your credit file. These can stay on your report for six years and significantly reduce your score.

2. High utilisation
Using too much of your Flex credit limit (or regularly maxing it out) may suggest financial pressure and lower your score.

3. Frequent reliance on Flex
Using BNPL services like Flex too often, or alongside other short-term credit, may make lenders cautious when you apply for traditional loans or mortgages.

4. Hard credit check
When you apply for Monzo Flex, Monzo carries out a hard credit check. This will be recorded on your credit file and may cause a small, short-term dip in your score.

Real-World Example

Ella was approved for Monzo Flex with a £1,200 credit limit. She used it to split the cost of a laptop into 6 payments. She set up a direct debit and paid each instalment on time. Over the next few months, her credit score rose gradually thanks to her good payment history and low credit utilisation.

Meanwhile, Jack used Monzo Flex frequently for everyday purchases and ended up missing a payment. This was reported to credit reference agencies, causing a drop in his score. He also found it harder to get approved for a personal loan later on.

Tips for Using Monzo Flex to Boost Your Credit Score

• Always pay on time: Set up direct debits or reminders to avoid missing a payment

• Use a small portion of your credit limit: Aim to use no more than 30 percent of your total Flex limit

• Avoid over-reliance: Use Flex for occasional planned purchases, not for everyday spending

• Check your credit report: Use services like Experian, ClearScore, or Credit Karma to track how Flex is reported

• Review your affordability: Make sure you can repay before choosing the 6 or 12-month option with interest

Final Thought

Monzo Flex can improve your credit score if used correctly. It gives you a chance to demonstrate responsible borrowing through on-time payments and low credit usage. However, it’s still a form of borrowing, and missed payments or overuse can have a negative impact.

If you’re aiming to build or strengthen your credit profile, Flex can be a helpful tool — but it should be part of a wider approach that includes good budgeting, timely payments, and healthy credit habits.