Monzo Remains Largest Digital Bank, Losing Market Share

Monzo hangs on to 'largest UK digital bank' crown

Monzo app

Monzo is still the largest digital bank in the UK, but its market share has fallen as rivals start to catch up, according to the latest figures from Apptopia as compiled by AltFi.

Monzo’s customer base has grown from around 3 million active monthly users in 2019 to over 5 million today, but that 5 million represents around 38 per cent of all digital banking users in the UK. The 3 million users in 2019 accounted for almost half of all users at the time.

Starling On The Rise

The second-largest digital bank in the UK is Starling Bank, which has improved from third place in 2019. It’s also increased its market share by the biggest amount – from 13.35% to 18.14%, almost five complete percentage points higher.

Revolut, the bank that was in second place in 2019, drops slightly to third with almost 16% of the market share, which is still a small gain on its share compared to the 2019 figures.

The largest drop comes from N26, as it made the decision to close all UK-based accounts following the difficulties with Brexit. It had almost 6% of the market share in 2019 which started to drop rapidly through 2020 as plans were made for the bank to leave Britain.

Other banks to have improved their market share standings over the last couple of years include Curve and Tide, along with smaller players Dozens and bunq. Cashplus Bank has remained fairly steady (a drop of less than 0.1% of the market share) while Pockit and Coconut have seen their share decrease.

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    It’s worth noting that the Apptopia data does not include usage from the high street banks that have digital offerings.

    Monzo Premium Takes Off

    The news of Monzo’s market share decrease won’t be as large a concern as it could’ve been thanks to the announcement of the number of premium account customers this week.

    CEO TS Anil revealed that the bank now has 135,000 customers on either a Monzo Plus or a Monzo Premium account, which is a 35,000 increase since December 2020. It’s estimated that this brings in around £10 million of revenue each year for the bank, although both accounts are still in their infancy, having only been launched in July 2020.

    Revenues for the bank as a whole are up 30 per cent compared to the pre-COVID levels and the bank is adding around 100,000 customers every month, according to the interview Anil gave to the Sunday Times at the weekend.

    The revenue is split fairly evenly across transaction payments, subscriptions and commissions, and lending.