Monzo has announced that it made a loss of £6.69m after tax for the year ended 28th February 2017.
The loss was an increase on the one reported in 2016 (£1.45m loss).
The mobile bank revealed that the largest remaining costs were customer support and ATM usage, but it believed it would be able to significantly improve customer support efficiency in the long term, so it was prepared to over-invest in the short term to provide customers with a world-class experience.
The announcement came as Monzo released its annual report to customers as it bids to improve transparency between the bank and its customers.
Over the past year, the bank has been granted its full licence from the PRA and has put foundations in place to launch full bank accounts.
Speaking about the bank’s financial performance, Tom Blomfield, CEO of Monzo, stated: “…We’ve got enough capital for at least the first 12 months of life as a bank.
“To create a viable, sustainable business, it’s important that we reach profitability over time.
“However, profitability is not a key priority for this year, and we would prefer to focus on growth over driving revenue.”
Monzo has hit 240,000 funded accounts with more than £250m spent in total, while it has also agreed £22.5m of investment from Passion Capital, Thrive, Orange Digital Ventures as well as 6,500 Crowdcube investors.
Monzo’s future plans
Tom added that Monzo would need to raise more funding in early 2018.
“If we grow even faster than expected, we may need to accelerate funding plans.
“We are also exploring ways to include a crowd component in the next investment round to include as many of our community as possible.”
The annual report also outlined two main priorities for the upcoming financial year: to grow its user base and roll out its current account.
“If we continue to grow at this rate, we will hit somewhere between 500,000 and 800,000 accounts by the end of the year,” said Tom.
“To continue to offer the level of support we aim for, we will need to significantly expand our team; we’re looking to bring on around 40 new customer operations staff in the next six months.
“We have about 50 current accounts live today among our staff, and we’ll soon progress to a few thousand customers.”
The bank revealed it did not want to be a full-service bank.
It would not be offering mortgages or credit cards as it wanted to be a platform which gave customers control of their money.
“At the moment, we’re aiming to offer the current account to all existing customers in late summer.
“The wait might be frustrating at times for our community, but it’s important to get it right.
“We have a responsibility to keep our customers’ money safe.”
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