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Monzo Valued at $5.2 Billion Amid US Neobank Expansion Plans

U.K. neobank Monzo reportedly raised $190 million as it plans to expand overseas.

The funding brings the total Monzo has raised to $610 million so far this year, valuing it at $5.2 billion, company officials told CNBC Wednesday (May 8).

The total funding marks the single-largest round for a European FinTech in the last year, the report said. CEO TS Anil said the company will use the new financing to create products and speed up its expansion plans.

“At the heart of it, we are a mission-oriented company that’s looking to build the single place where people can meet all of their financial needs,” Anil said in an interview with the network. “What’s exciting to me is that, as we pursue that mission of changing people’s relationship with money, we’ve built a business model that is congruent with that as well, with this model that is built entirely around the customer.”

Monzo has been looking to expand into the United States, last year hiring former Cash App Head of Product Conor Walsh to serve as its U.S. CEO.

The company decided not to pursue plans to get a banking license in the U.S., and Anil said in the report that Monzo is now focused on making sure its services in America can keep up with the likes of banking giants such as Citibank and J.P. Morgan.

“The necessary conditions for the U.S. for us is getting the product right,” Anil said, per the report. “That’s what we’re spending our time and effort on there.”

Monzo in March released earnings showing it had been profitable on an operating basis, with transaction income increasing as card spend rose 38% year over year.

As PYMNTS wrote at the time, the company, along with contemporaries Chime and Starling“stand out in the neobank sector, as they achieved profitability and as valuation rounds point to what might be a sanguine outlook for those players.”

At the same time, PYMNTS added, there are still some factors that suggest that sustained profitability could be a challenge in a sector where, among dozens of players, only a small percentage have gone into the black.

In addition, PYMNTS Intelligence research showed that 9% of consumers use FinTechs as their primary banks, while 47% of consumers said they are hesitant to use these digital-only players.