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Monzo losses widen but the digital bank's user numbers surge

Monzo, the fast-growing digital bank, has trebled its user numbers to 750,000 in a year, but has said profitability is its “next challenge” after losses jumped fourfold to ?33.1m.
Tom Blomfield, founder and chief executive, said the tech darling had made “real progress” and expected to reach “several million” customers by the end of 2019.
The east London-based bank had a milestone year after gaining its banking licence last April and later shifted hundreds of thousands of customers from pre-paid debit cards to fully-fledged current accounts. The lender has also started offering overdrafts.
Customers have spent more than ?2bn through Monzo and have warmed to its mobile budgeting tools and hot coral payment cards.
Monzo staff numbers have increased to 300. The company’s stated aim is to ultimately reach a billion users worldwide.
Monzo losses widen but the digital bank's user numbers surge

Monzo's coral-coloured payment cards have proived popular with customers

Credit:
PA
However, losses ballooned during the 12-month period to the end of February as Monzo invested to fuel expansion. Pre-tax losses hit ?33.1m, up from ?7.9m the previous year.
Mr Blomfield said Monzo planned to achieve profitability “very soon” through services such as overdrafts and further cost cuts.
The cost per customer figure is down from a peak of ?65 last September, to ?15 per head today.
The bank said it would look to cut costs further by providing more automated help services alongside support staff.
In the bank’s annual report Mr Blomfield said its new “mission” was “Monzo makes money work for ­everyone”.
Mr Blomfield has previously told The Daily Telegraph that the company could float on the London stock exchange in as little as two to seven years.
Monzo’s highest paid director earned ?305,000 during the year in wages and share-based payments, up from ?60,000 the previous year.
A Monzo spokesman said this went to one of the company's non-executive directors. Mr Blomfield earned a salary of ?80,000 and did not take any additional share-based payments during the year.
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