FinTech: Monzo To Turn Profitable In 2023, Says CEO
TS Anil, CEO of Monzo, was speaking at the FT banking summit.
“We will be profitable in the next financial year,” TS Anil said at the summit on Thursday, though Monzo reported pre-tax losses of £119mn for the 12 months to the end of February 2022 in the financial results it declared in July. Anil’s statement also marks a sea change from 2021, when auditors expressed “material uncertainties” over its ability to remain in business. (FT)
Monzo is also being probed by the Financial Conduct Authority for alleged breaches of anti-money laundering laws. The neobank also was forced to withdraw its US banking licence application last year, after regulators expressed doubts on its approval.
“In the tech space you saw a lot of companies who built business models out of free or cheap cash,” said Anil, however. “We’ve never been one of those companies who have a bloated headcount when things are good and panic when things get worse.”
That is a reference to the current turmoil in the fintech industry, with many companies having to resort to layoffs to check losses and stem a rout in valuations after a market decline panicked investors.
Klarna and Stripe are big name fintechs in this context.
Meanwhile, rival neobank Starling, which is backed by Goldman Sachs, has already clocked a pre-tax annual profit.
“We’ve chosen to double down on the UK and not spread ourselves thin,” Anil said at the summit. “This is a market we’re poised to win in and a geographic expansion will come on the back of that.”
Nevertheless, the US remained “the next port of call” for expansion, Anil affirmed.
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