Digital bank Monzo reports first annual profit in run-up to IPO

MONZO reported its first annual profit on Monday (Jun 3) in a milestone for the fast-growing British digital bank as it works towards its goal of a stock market flotation.

The mobile app-based bank has amassed 9.7 million customers since its launch in 2015, but has previously found it tough to translate its popularity into profit.

Monzo reported a pretax profit of £15.4 million (S$26.5million) for the year to March 2024 in its latest annual accounts, compared with a £116.3 million loss the previous year.

The company’s push into more lending and savings products has helped boost its revenue, which more than doubled to £514.4 million from £214.5 million.

The company secured £340 million in new funding in March in a round led by Alphabet-owned fund CapitalG, valuing the company at £4 billion.

Monzo chief executive officer TS Anil has previously said that the firm aims to become a publicly-listed company.

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The bank’s push into lending – including buy-now-pay-later products – has come at some cost, with its provision for potential loan defaults almost doubling to £204 million, up from £106 million.

Monzo is also making a second tilt at the lucrative US market after hiring a new leadership team for the venture, after having abandoned a previous attempt in 2021.

The company said it was also in the early stages of opening an office in Dublin, ahead of a potential expansion into other European markets.