British neobank Monzo said that it managed to achieve profitability.
The annual report of the financial institution contains information that according to the results of the year of activity that ended in February 2023, the indicator of net operating income was fixed at the level of $ 266 million. This figure is almost twice the result of a year ago.
The losses of the financial institution in the period from February 2022 to February of this year amounted to $ 144 million. A year earlier, this figure was equal to $ 147 million.
The bank’s chief financial officer, James Davis, wrote in a report that the lender enters the 2024 fiscal year with a well-capitalized balance sheet and positive cash flow. He also said that according to the results of the first two months of the new financial year, the bank has achieved profitability and is a business with diverse and stable income. According to him, the positive dynamics are the result of a large and growing base of personal and business clients.
The report contains information that by the end of the fiscal year 2023, 1.5 million new customers have opened personal accounts in a financial institution. Currently, the lender’s customer base is 7.2 million people. The expenses of the bank’s service consumers increased by 38% over the last financial year.
The report also indicates that the number of business clients of the lender for the 2023 financial year increased by 79%, amounting to more than 200 thousand people. The positive dynamics of the bank’s interaction with business consumers are separately stated.
Revenue growth was largely driven by Monzo Plus and Monzo Premium subscription services, which grew by 77% over the year. More than 350 thousand personal customers pay a monthly subscription fee. The lender states that consumers in this category are more involved in the process of interacting with the bank compared to those who are not among the subscribers. Working with these clients has a positive impact on profitability and demonstrates the value of additional features in subscription products.
The report was published a few days after another British neobank Starling released revenue data showing income growth doubled over the year.
As we have reported earlier, Investment Banks Approach Monzo Over IPO.