After Monzo, its’s UK competitor Revolut must also announce a massive increase in its losses. Revolut said its losses more than tripled in 2019, despite a surge in revenues and customer numbers. The London-based company posted a total loss of £106.5 million ($139.6 million) for the year ending December 31, up from £32.9 million in 2018.
Just recently, Revolut’s competitor Monzo also had to report an annual post-tax loss of £113.8 million ($149.5 million) up from the £47.1 million it lost last year. It’s tough times for FinTechs, it seems. On the other hand, Starling Bank, a FinTech company also operating in the UK and competing mainly with Monzo, has announced that it intends to post profits in 2020.
The loss occurred despite Revolut’s revenues climbing 180% to £162.7 million from the £58.2 million it reported in 2018. The leading FinTech also nearly tripled its user base in 2019 to 10 million from 3.5 million a year earlier.
Revolut explained that the mounting losses are due to its investment in international expansion and new product offerings. In 2019, the firm launched a commission-free stock trading feature to take on incumbent online brokers. It’s also been pushing its presence into new regions like the U.S., Singapore, and Australia. While Monzo claims that the COVID-19 pandemics seriously threatens its business, Revolut said momentum in its business hadn’t slowed. Compared to Monzo, Revolut has a much broader business model. This could be one of the reasons that growth is not significantly affected by the COVID-19 crisis.