ClearBank, the enabler of real-time clearing and embedded banking for financial institutions, today presents the results from its 2023 Annual Report.
It shows ClearBank’s first full year of profitability, “with strong growth in income, platform and transaction fees, deposits, and clients.”
In a challenging and uncertain year for the financial services market, ClearBank’s combination of fully licensed banking services and innovative financial technology “has allowed it to grow across every segment and business line. It today reports pre-tax profits of £18.4m, compared to a loss of £7.1m in 2022. The bank reached UK monthly profitability in November 2022. Total income has grown 91% YoY to £111.3m.”
ClearBank’s model, where funds “are held at the Bank of England, has made it attractive to clients looking to increase protection and provide better returns in a high-interest environment. It now holds £6.1bn (up 103% YoY) in deposits, as institutions seek out security and safety in a resilient banking partner.”
The bank has seen payment volumes “increase 54% YoY, totaling 108m for 2023.”
This was driven by the significant “expansion of the bank’s client base, the number of bank accounts held by them and their end-customers, and an acceleration in open banking transactions. Bank accounts held across all product offerings reached 10m in total, representing a 22% increase YoY.”
ClearBank continues to progress its European banking license application and international expansion plans, with “a full EU launch expected later this year.”
Key 2023 highlights:
- Boost in embedded banking end-customers: Embedded banking end-customers grew 93% YoY. 1.2m customers now hold FSCS-protected accounts through partners such as Chip, Raisin, and Tide. ClearBank’s model enables highly competitive interest rates to be passed along to embedded banking clients’ customers.
Banking the newest banks: ClearBank now works with 15 of the UK’s newest banks including Allica Bank and Alba Bank. It is trusted to provide services such as connections to payment schemes, underpinning its commitment to enabling a competitive and dynamic financial services market in the UK. - Growth in fees: More embedded banking clients, agency clients, and greater transaction volumes resulted in a growth in fees, including reoccurring platform fees. Total payment scheme volumes, aided by a sharp rise in Open Banking-driven Account-to-Account (A2A) transactions using Faster Payment System (FPS), grew by 54%.
- Continued innovation: ClearBank continues to add features to its platform as part of its commitment to innovation. 2023 saw the addition of CASS for seamless current account switching, and greater peace of mind through Confirmation of Payee-as-a-Service, where clients can use ClearBank as a technical provider of CoP checks. A new cross-border GBP service allows customers to remit GBP into any permissible overseas GBP account. The bank also enabled the launch of a market-leading Cash ISA product with its embedded banking partner, Chip.
Charles McManus, CEO, ClearBank said:
“We have been able to offer resilience and stability in an uncertain market, building services our customers need, including a best-in-class embedded banking offering. But this is just one step on the journey, not the finish line.”
Mark Fairless, CFO, ClearBank said:
“ClearBank has not just achieved profitability, it has done so through deliberate, purposeful, and sustainable growth. Our success enables the success of others in the market, whether through our partnerships with so many new banks, or our embedded banking platform offering interest-bearing accounts with money held at the Bank of England.”