ClearBank Ltd., an enabler of bank accounts, real-time clearing, and embedded banking for financial institutions, presents its unaudited H1 2023 results.
The bank saw “a 144% YoY increase in revenues from £20.2m in H1 2022 to £49.3m in H1 2023.” Over the same period, customer deposits “grew 80% from £3bn to £5.4bn across nearly one million accounts, and payment volumes grew by 39% as the number of clients surpassed 200 institutions.”
The first quarter of 2023 saw “a series of systemic events, including the failure of SVB leading to a rippling effect of challenges across the US and European financial services markets.”
This has resulted “in a flight to established and secure yet innovative banking partners.”
Against this backdrop, ClearBank’s unique combination of fully licensed banking services, next-generation technology platform, and embedded banking proposition “ensured another period of accelerated growth with significant momentum across all lines of the business.”
In particular, institutions are seeking “to increase protection of deposits and provide better returns for their customers than those offered so far by mainstream banks, which have been slow to pass on interest rate rises.”
ClearBank is working with clients “such as Chip and Raisin UK to offer market-leading savings rates to help consumers make their money work harder in a high inflation environment.”
Client funds are held “at the Bank of England for maximum security of deposits and peace of mind for customers.”
These client propositions have “driven an increase in the number of embedded banking end-customers to 979k (+125% YoY increase) in H1, with 99% of these accounts FSCS protected (979k vs. 988k).”
Embedded banking is where banking services, “like FSCS accounts, are directly embedded into the experience of the end user by a licensed bank, and ClearBank is the only UK bank to offer this at scale.”
Following sustained monthly profitability since November 2022, ClearBank posted a £5.9m profit before tax in H1 2023. The fintech bank is “on track to achieve annual profitability later this year, with international expansion approaching, as ClearBank continues to progress it’s European banking licence application.”
H1 2023 highlights:
- All lines of business across embedded banking, FX and multicurrency, and payment clearing contributed to the increase in revenue, from £20.2m (H1 2022) to £49.3m (H1 2023), a 144% YoY rise.
- ClearBank’s customer deposits grew by 80%, from £3bn to £5.4bn across nearly one million accounts and 200 institutions including banks, credit unions, building societies, fintechs and digital asset companies.
- Having achieved monthly profitability in late 2022, H1 2023 has seen consistent profitability, with profit before tax of £5.9m.
- Payment volumes grew by 39% aided by growth in open banking driven A2A (account to account) transactions using Faster Payments.
Charles McManus, CEO, ClearBank, said:
“Following an exceptional year for ClearBank in 2022, the first half of 2023 has been extraordinary with accelerated growth across all lines of business. As institutions take flight to quality by seeking scale, security, and safety in their banking partner, we’ve seen significant increases in customer deposits and payments volumes – especially around our embedded banking and open banking propositions. Now customers are demanding more from us, especially the ability to transact in GBP, USD and EUR, which is driving our upcoming expansion to Europe, followed by the US.”
Mark Fairless, CFO, ClearBank, said:
“Having reached profitability at the end of 2022, ClearBank is now on the path to achieve full year profitability in 2023. We’ve announced a number of key partnerships in 2023 to date, with customer numbers reaching more than 200, and our pipeline of new business remains strong. And in an uncertain market our technology ensures high levels of availability, reliability, and resilience delivering optimal operational outcomes for our clients. As our expansion plans into Europe continue, our clients and partners remain assured that their funds are secure, whilst benefiting from a unique business model that helps them to innovate, differentiate, and grow.”