Monzo expands funding to USD 610 mln

The company said the cash has been raised from new investors including Hedosophia, a backer of top European fintechs including N26, and Qonto. CapitalG, Alphabet’s independent growth fund, also participated in the round.

This funding values Monzo at roughly USD 5.2 billion, an increase on the USD 5 billion valuation it attained in March 2024 when it raised USD 430 million. The total USD 610 million round marks one of the biggest funding rounds for a European fintech since 2023, an extension of its previous announcement, when it was getting to ready to finalise the round at the 500 million threshold.

Monzo’s officials said they plan to use the cash to build new products and accelerate the company’s international expansion strategy. They are on a mission to build the single place where people can meet all of their financial needs.

Monzo hit profitability following the end of its 2023 fiscal year. The digital bank is looking to ramp up profits with diversification into other income generators, like lending and savings. Notably, it is planning to launch its first pensions product by the end of 2024.

Global expansion plans

Monzo counts more than 9 million retail customers in the UK — 2 million of whom joined Monzo in 2023 — and over 400,000 business customers.

In 2023 Monzo made its first foray into investments with a feature allowing customers to invest in funds managed by BlackRock. The digital bank identified that about a third of people using the service had never invested previously — and, more notably, 45% of the women investing via the Monzo app are first-time investors.

The company recently restarted its US expansion efforts, hiring a new US CEO after earlier abandoning a bid to acquire a banking license from US regulators. For now Monzo’s team in the US is primarily focusing on product to ensure that the service it has there is of high enough quality that it can compete with major incumbents like JPMorgan and Citibank.

Mortgages incoming

Longer term, Monzo is also planning to launch a mortgages product, which would see it compete much more aggressively with UK retail banks in the world of lending. It currently offers monthly instalment plans and consumer loans via its app.

Monzo also has a ‘Mortgage Tracker’ feature which lets users track how much they’ve paid toward their mortgage and how much equity they’ve built. But it’s yet to officially roll out a service that would let people apply for mortgages directly within its app. The bank is in the early stages of exploring partnerships with lenders to offer this.