It’s a red card for Monzo expansion
MONZO saw losses balloon last year after its banking ambitions led to a 336 percent surge in operational costs. The digital challenger logged pre-tax losses of £33.1million in the year to February 2018, having widened from just £7.9million a year earlier.
It said this was the result of a rise in operating costs from £8million to £34.9million, due to investments in becoming “a fully operational bank”.
The company began offering current accounts in September, and has since fully phased out its pre-paid cards. It also introduced overdrafts, taken up by about 37,000 customers, and lifted revenues.
The company’s aim is to reach a billion users worldwide.
Interest income came in at £150,000, having been nil a year earlier, while fee and commission income rose to £2.2million from £112,000.
Moving to current accounts has given our customers access to all the power and protection that comes with a full banking licence
Oxford-educated chief executive Tom Blomfield said: "Moving to current accounts has given our customers access to all the power and protection that comes with a full banking licence.
“But it's also helped us begin to address our next challenge: profitability.”
Monzo’s highest earning director, thought to be Mr Blomfield, was paid £305,000 during the year in wages and share-based payments, up from £60,000 the previous year.
About 750,000 people are using Monzo's current accounts.