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Monzo set to hit 5 million customers after riding out rocky year

Oscar Williams-Grut
·Senior City Correspondent, Yahoo Finance UK
·2-min read
Monzo was just 5,000 customers shy of hitting 5 million users on Friday. Photo: Dado Ruvic/Illustration/Reuters
Monzo was just 5,000 customers shy of hitting 5 million users on Friday. Photo: Dado Ruvic/Illustration/Reuters

App-only challenger bank is set to reach 5 million customers within days, as the business rebounds from a rocky year sparked by the COVID-19 pandemic.

Monzo was just 5,000 customers shy of hitting 5 million users on Friday, Yahoo Finance UK understands. Monzo averages about 100,000 new customer sign-ups each month, putting the bank on track to cross the 5 million mark within days.

It means the challenger bank has signed up just over 1 million new customers in the last 12 months. Last February, Monzo said it had 3.9m users, up from 1.3m in 2019.

Monzo was founded in 2015. It was one of a number of digital only banks that launched at the time, aiming to take on the traditional high street lenders. It has become known for its sleek design and deep engagement with customers. The bank has one of the highest net promoter score in the industry.

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The symbolic milestone of 5 million customers comes after a rocky 2020 for the business. Monzo was forced to lay-off staff and write down its value due to the pandemic, which crushed its core business model. Last summer founder and former chief executive Tom Blomfield said 2020 would be a "pivotal year" for the bank. Blomfield left the business last month due to stress.

Monzo's new chief executive TS Anil has helped the company ride out the crisis and appears to have got the bank back on an even keel. He has spearheaded the launch of paid-for products to help grow revenues and get the business on a more sustainable footing.

Over 100,000 customers now pay for either Monzo Plus or Premium accounts and the bank has signed up 70,000 business customers. Weekly revenues are now 30% above pre-COVID levels.

Monzo raised £60m ($83m) from investors in December and is said to be in talks to raise a further £50m. The company had revenues of £67.2m last year but has yet to turn a profit.

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