The UK challenger Monzo bank has recently reported £130M in pre-tax losses up from £114 million in the same period in 2020.
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Monzo’s revenue has doubled since April 2020 and is 30% higher than pre-lockdown levels. In 2021 the challenger’s revenue increased by £12 million to £79 million.
Although Monzo secured about 200,000 paying subscribers to its premium accounts and managed to add one million new customers over the year. Also, the deposits increased from £1.4 billion to £3.1 billion which meant a 124% increase.
However, this is not the only issue that Monzo has on its table. The challenger has revealed information is being investigated by the Financial Conduct Authority (FCA) over potential breaches of financial crime regulations.
“In May 2021, the FCA notified us that it had started an investigation into our compliance with the Money Laundering Regulations 2017, potential breaches of some of the FCA Principles for Businesses and related FCA rules for anti-money laundering and financial crime systems and controls between 1 October 2018 to 30 April 2021,” Monzo said in its annual report.
The digital bank claims that the investigation is looking into both potential civil and criminal liability.
“We’re cooperating with the FCA’s investigation, which is at an early stage,” the firm states.
TS Anil, Monzo CEO, said that it had been a really challenging year for the bank but that the company has shown extraordinary resilience and more importantly a significant amount of growth as well.
Anil insisted that the bank was aiming to become profitable in 2022 and would raise more money from investors “in the next few months” so it is able to fuel growth and can stay ahead of regulatory capital rules as Monzo’s balance sheet expands.
COO Sujata Bhatia told Sifted last month that an IPO in the coming years is still on the roadmap.