Monzo’s profit rockets as customer base grows by a quarter
UK fintech darling Monzo posted a mammoth profit jump in the last financial year as its customer base swelled.
The neobank’s pre-tax profit came in at £87.3m, 44 per cent higher than the £60m scored in 2024. The increase came as revenue stormed 40 per cent higher to £1.7bn.
Monzo’s total users ballooned 25 per cent in the period to 15.2m, which paved the way for a 55 per cent surge in deposits, reaching £25.7bn.
Both income from interest rates as well as that from fees and commission had a dual jump of just north of 39 per cent. Interest income hit £1.2bn whilst fee income was just shy of £459m.
Throughout the year, Monzo racked up a higher cost base with operating expenses climbing by over a third to £925.5m. It aggressively expanded its workforce with headcount growing 37 per cent after adding 1,341 employees taking the total to 5,275.
Monzo shrugs off £21m hit
It added it was able to absorb cost spikes that came from regulatory developments, which included a £21m fine from the City watchdog last year.
The regulator found last July Monzo had onboarded customers on the basis of “limited, and in some cases, obviously plausible information – such as customers using well known London landmarks as an address”. These included Buckingham Palace and 10 Downing Street and Monzo’s own business address.
Fraud loss and compensation reimbursements to victims also soared 85 per cent higher this year, as the bank paid out £59.6m in refunds. This came alongside the introduction of new consumer reimbursement laws that drove up the costs.
In the last few months, Monzo has dropped ambitions for US expansion and has turned its attention to continental Europe. After launching in Ireland, the digital bank said Spain is the next on its sights.
Diana Layfield, group chief of Monzo who came into the post this year, said: “Millions of customers are choosing Monzo for more of their financial lives.
“Our mission to make money work for everyone is more relevant than ever, and the opportunity ahead has never been greater.”