UK’s Digital Bank Monzo Reports Pre-Tax Profit, Preps for EU Expansion with Dublin Office

UK’s digital bank Monzo has released its 2024 financial results.

Monzo announced its first full-year pre-tax profit.

The Fintech firm also revealed that it’s currently in the early phases of expanding into the wider European markets through a new division in Ireland.

The update from Monzo has been announced after the neobank secured considerable new funding, beginning with $430 million in March of this year. This was followed by an additional $190 million this past month at a $5.2 billion valuation.

A considerable portion of this funding is meant for supporting its business expansion efforts in the US markets. This is reportedly a maret that Monzo has been looking to tap for several years.

This past October, the Fintech firm appointed another Chief Executive Officer for its US-based business operations. Monzo announced Conor Walsh (from Block’s Cash App) as its CEO.

Now, Monzo intends to expand into markets that are situated closer to its head offices. This, as the Fintech looks to enter a new gateway in Ireland. With this launch, Monzo will establish a new location in Dublin. However, the firm has not shared a definitive timeline for this at the time of writing.

It’s worth noting that Monzo initially reached profitability in the first two months of this past calendar year. This is said to be a key milestone supported by Monzo’s lending product as well as the UK’s competitive interest rates.

This development then continued for the rest of the financial year with the Fintech presently reporting a pre-tax profit of £15.4 million. This figure can be compared to a full-year £119 million loss for 2022 as well as a £116 million loss for the last year.

Digital bank Monzo further revealed that its revenue surged 250% to £880 million in the last year.

As mentioned in the extensive report, Monzo’s board chair Gary Hoffman notes that an expected interest rate decline might affect its performance for the next 12 months. Hoffman said that the “external uncertainties” could create “volatility” for the banking industry.

Hoffman also shared:

“The UK has just emerged from a technical recession … While these risks could impact our performance and plans, I believe that we are strongly positioned to not just withstand these potential headwinds, but actually go on to thrive in the face of them.”

Overall, it has been generally positive for neobanking platforms, with Monzo’s main competitor Revolut reporting its very first full year of profitability in the last year.

Meanwhile, Brazil-based Nubank has been performing really well, with its valuation jumping to $58 billion during this year. However, this has been followed up by a recovery from a $9 million loss back in 2022 to a $1 billion total profit this past year.

Notably, Monzo has seen its user-base increase by over than 2.3 million to 9.7 million. This reportedly includes 400,000 business clients.

The Fintech firm stated that it anticipates expanding its customer base to about 11 million in the year ahead.

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