Monzo valuation could drop by 40% as customers curb spending

The digital-only bank is looking to raise £70-80mln according to reports

Monzo - Monzo valuation could drop by 40% as customers halt debit-card non-essential spending

Monzo is reportedly in the final stages of negotiating a fresh round of funding that might see its valuation drop by 40%.

The fast-growing digital-only bank is looking to raise £70-80mln to strengthen its balance sheet, but the price of the funding values the business at £1.25bn compared to £2bn at the time of its last cash injection a year ago, according to reports today.

According to the FT, the majority of the funding will come from existing shareholders such as Accel, Y Combinator Continuity, Goodwater Capital and Passion Capital rather than new investors.

As the coronavirus crisis bites into consumer spending, Monzo’s customers are cutting purchases on their debit cards, while the restrictions on international travel have meant fewer transactions abroad.

Monzo built its reputation as a card for travelling overseas though has now expanded to full banking in the UK and has plans to apply for a licence in the US.

Recently chief executive Tom Blomfield agreed to waive his salary for a year while other senior management took 25% pay cuts.

Monzo expects to close the funding round within the next month with the final value and amount raised yet to settled, said the report.



Add related topics to MyProactive

Create your account: sign up and get ahead on news and events


The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is...



Inspired Energy PLC has remained profitable and cash generative during lockdown

Inspired Energy PLC's (LON:INSE) Mark Dickinson tells Proactive London's Andrew Scott he's pleased with how recent trading has held up and that the business is well positioned to work its way through the pandemic thanks to a strong balance sheet. He says he's been encouraged by the performance...

46 minutes ago

2 min read