Technology

British digital bank Monzo hits monthly profitability for the first time after spike in lending

Published

2 years ago

May 31, 2023

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A Mastercard debit card from U.K. digital bank Monzo.

Monzo

Monzo on Wednesday said it hit profitability for the first time this year, in a major milestone for one of the U.K.’s most prominent digital banks.

In its annual report for the year ending February 2023, Monzo reported net operating income of £214.5 million ($266.1 million), almost doubling year-over-year from £114 million.

Losses at the bank nevertheless came in at a substantial £116.3 million — though this was slightly lower than the £119 million net loss Monzo reported in 2022.

Still, the company managed to reach profitability in the first two months of the year.

In its annual report, Chief Financial Officer James Davies said Monzo is “now a business with diverse and stabilising revenue from a large, and growing, personal and business customer base.”

“Profitability was always a choice as we balance continuing to invest in growth with profitability,” Monzo’s CEO, TS Anil, told CNBC in an interview. “We could have chosen to be profitable a few quarters ago.”

Monzo is not the first digital bank to hit profitability. Starling Bank reached that milestone for the first time in 2021. Fellow fintech Allica Bank reached monthly profitability last year.

Monzo’s move into the black was largely thanks to a substantial increase in income from newer revenue lines, such as lending and subscriptions. Paid accounts now total 350,000.

Monzo declined to share a figure on how much of a profit it is making currently. The firm said it is on track to reach full-year profitability by the end of 2024.

Lending growth

Monzo’s strong revenue performance was driven by a bumper year for its lending business. This came against a backdrop of pain for U.K. consumers, who’re grappling with a harsh cost-of-living crisis as inflation soars.

Total lending volume reached £759.7 million, almost tripling year-on-year, while net interest income spiked by 382% to £164.2 million. That was as usage of overdrafts, unsecured personal loans, and the Monzo Flex buy now, pay later service grew sharply.

Yet credit losses also surged dramatically, as the bank set aside a mountain of funds to deal with a sharp climb in anticipated defaults. Credit losses swelled to £101.2 million, a more than sevenfold increase from £14 million in 2022.

It comes as consumers are increasingly turning to unsecured credit, such as credit cards and personal loans, to offset the impact of the rising cost of living. Research from consulting firm PwC indicates U.K. household debt exceeded £2 trillion for the first time in January.

Monzo’s boss disputed that the cost-of-living crisis had contributed to its revenue performance.

“The cost-of-living crisis was painful for everyone, but it really underscored the ways in which the Monzo product is incredibly powerful,” Anil told CNBC.

He added the growing cost of living impacted how people used Monzo products, with usage of its savings pots and budgeting tools rising.

Meanwhile, Monzo said it continues to work with the Financial Conduct Authority regulator over an ongoing inquiry into the company’s alleged breaches of anti-money laundering laws.

“We expect it to take time to resolve,” Monzo said. “This could have a negative impact on our financial position, but we won’t know when or what the outcome will be for some time.”

UK ‘not holding us back’

The fintech sector has experienced increasing scrutiny since it grew in prominence after the 2020 Covid outbreak.

Major digital banks, from Revolut to N26, are receiving heightened attention from regulators. Revolut is reportedly set to have its application for a banking license rejected by the Bank of England, according to the Telegraph.

A number of tech bosses have expressed doubts about the U.K.’s bid to become a global tech power on the back of notable setbacks, including Cambridge-based chip design firm Arm’s decision to list in New York rather than London.

Revolut CEO Nik Storonsky earlier this month said his firm had encountered “extreme bureaucracy” in its experience applying for a banking license in the U.K. and said he would never list in the country. Monzo co-founder Tom Blomfield, meanwhile, left London for San Francisco, citing a “much more accepting” environment for tech founders.

“From our perspective, this is a country where we got licensed, this is our home market; we’ve clearly learned this is where we can build a business of scale,” Monzo’s Anil said. “It’s not holding us back, I don’t think of it like that at all.”

Monzo now has 7.4 million customers in the U.K., making it the seventh-largest bank in the U.K. by client numbers. Total customer deposits now stand at £6 billion.

Technology

Cybersecurity provider Netskope boosts IPO range as it tests tech hotstreak

Published

47 mins ago

September 16, 2025

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Cybersecurity provider Netskope boosts IPO range as it tests tech hotstreak

Sanjay Beri, chief executive officer and founder of Netskope Inc., listens during a Bloomberg West television interview in San Francisco, California.

David Paul Morris | Bloomberg | Getty Images

Netskope is targeting a $7.3 billion valuation in its upcoming initial public offering, after lifting its planned price range.

The cybersecurity company said it plans to sell 47.8 million shares at between $17 and $19 apiece. The deal would raise as much as $908 million at the top end.

That’s up from a previous range of $15 to $17 a share the company revealed in a filing last week, at a $6.5 billion valuation.

The cloud security company revealed plans to go public on the Nasdaq in a filing last month. Its planned debut comes amid an influx of big cybersecurity deals and during a resurgence in IPO activity after soaring inflation and interest rates squashed appetite for tech deals.

OpenAI to launch ChatGPT for teens with parental controls as company faces scrutiny over safety

Published

4 hours ago

September 16, 2025

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OpenAI to launch ChatGPT for teens with parental controls as company faces scrutiny over safety

OpenAI CEO Sam Altman walks on the day of a meeting of the White House Task Force on Artificial Intelligence (AI) Education in the East Room at the White House in Washington, D.C., U.S., September 4, 2025.

Brian Snyder | Reuters

OpenAI on Tuesday announced it will launch a dedicated ChatGPT experience with parental controls for users under 18 years old as the artificial intelligence company works to enhance safety protections for teenagers.

When OpenAI identifies that a user is a minor, they will automatically be directed to an age-appropriate ChatGPT experience that blocks graphic and sexual content and can involve law enforcement in rare cases of acute distress, the company said.

OpenAI is also developing a technology to better predict a user’s age, but ChatGPT will default to the under-18 experience if there is uncertainty or incomplete information.

The startup’s safety updates come after the Federal Trade Commission recently launched an inquiry into several tech companies, including OpenAI, over how AI chatbots like ChatGPT potentially negatively affect children and teenagers.

The agency said it wants to understand what steps these companies have taken to “evaluate the safety of these chatbots when acting as companions,” according to a release.

OpenAI also shared how ChatGPT will handle “sensitive situations” last month after a lawsuit from a family blamed the chatbot for their teenage son’s death by suicide.

YouTube says it has paid creators more than $100 billion over last 4 years

Published

4 hours ago

September 16, 2025

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YouTube says it has paid creators more than 0 billion over last 4 years

A Youtube podcast microphone is seen at the Variety Podcasting Brunch Presented By YouTube at Austin Proper Hotel in Austin, Texas, on March 8, 2025.

Mat Hayward | Variety | Getty Images

YouTube said on Tuesday it has paid out over $100 billion to creators, artists and media companies since 2021.

The surge has been fueled in part by growing viewership on connected TVs. The number of channels making more than $100,000 from TV screens jumped 45% year over year, the company said.

YouTube Chief Product Officer Johanna Voolich praised the power of creators to “shape culture and entertainment in ways we never thought possible” in a release announcing the benchmark and a series of other new features.

The milestone comes as the Google-owned platform marks its 20th year and pushes to cement itself as one of the world’s most lucrative media businesses.

YouTube unveiled the updated payout figure and a slate of new creator tools at its annual Made on YouTube event in New York City.