Monzo pulls out of US ahead of much-anticipated IPO — TFN

Fintech Monzo has shut down its US operations, first reported by Bloomberg and confirmed by TFN. The UK-based challenger financial institution stopped accepting new American prospects and laid off round 50 workers. It can shut present accounts by June 2026.

Monzo secured its European banking licence in December, and it now sees essentially the most progress there.

“We’re making a deliberate, strategic resolution to concentrate on scaling in our residence market and Europe and to step away from the US,” a spokesperson informed TFN when approached for remark, pointing to the licence.

The fintech is broadly anticipated to go public this 12 months, suggesting the transfer could possibly be half of a bigger technique to turn into IPO-ready. It additionally reportedly changed chief govt TS Anil over the timing of the float, based on a earlier Financial Times report. Trade exec Anil was the group’s CEO for nearly six years, having first headed up its US operations. 

The optimistic message doesn’t change the primary level: when an organization is robust at residence, it’s exhausting to justify spending extra in a market the place it can’t develop. It’s even tougher to elucidate this to future public traders.

Non-public and public market traders could also be quietly happy by the information, given {that a} European focus may point out the place Monzo is making ready to listing. It was beforehand rumoured to be wanting on the US inventory markets, becoming a member of a laundry listing of European corporations that head Stateside to listing.

“We’re very grateful to our US colleagues and prospects for his or her help and love for Monzo,” the Monzo spokesperson added. 

The US enlargement by no means took off

The corporate introduced its US enlargement in 2019 however withdrew its utility for a banking constitution in late 2021 after regulators steered it could be rejected, based on American Banker.

With out its personal constitution, Monzo needed to depend on companion banks to carry deposits and situation debit playing cards, first with Sutton Financial institution after which with Lead Financial institution. That dependency meant Monzo couldn’t originate loans, entry core fee rails immediately, or compete within the lending and interchange income streams that outline US banking profitability. 

Consequently, Monzo remained extra of a easy app than a full financial institution. A renewed attempt to secure a licence was reportedly thought of as not too long ago as late 2025, based on PYMNTS.

The IPO was additionally a key issue, with the London listing valued at between £6 billion and £10 billion, and new management reducing underperforming areas and enhancing the story for public markets. The board changed Anil with Diana Layfield, who had labored at Google and Commonplace Chartered.

For the 12 months ending March 2025, Monzo reported revenue of £1.24 billion, up 48% from the earlier 12 months. Adjusted pre-tax revenue rose to £113.9 million, an eightfold enhance. Buyer deposits additionally grew 48% to £16.6 billion. 

Europe is the following chapter

Not like within the US, the place monetary startups should navigate a fragmented, state-by-state licensing regime, an EU regulatory licence grants passporting rights throughout the whole European Financial Space beneath a single framework — a win for fintechs on the continent when different sectors face fractured and laborious laws. 

RivalRevolut can also be making an attempt once more to safe a US banking licence, submitting functions with the OCC and the FDIC to create Revolut Financial institution US, N.A., which might permit it to function in all 50 states.

If Revolut has the capital, the persistence, and the regulatory goodwill to see it by, it stays an open query. What Monzo’s exit makes clear is that the choice, constructing a significant US enterprise with out these foundations, shouldn’t be actually an choice in any respect.