In 2015, app-based bank Monzo set out to disrupt the banking world with a ‘hot coral’ debit card.
It was one of the earliest of a number of app-based challenger banks looking to take on the high street giants to offer a better banking experience for customers.
Fast forward a decade and a record 1million customers joined Monzo between April and June this year, showing that has truly become a thorn in the side of traditional banks.
It reported that it bagged 300,000 customers each month last quarter, with May and June being record months for numbers of new customers joining.
Between 1 April 2024 and 31 March 2025, 2.4million Monzo customers opened an account, meaning that in three months it signed up almost half the number of customers it achieved in a year.
Data from the Current Account Switch Service (Cass), released three months in arrears, show that in the first three months of the year, 15,515 customers switched their main bank account to Monzo.
Record gains: A record 1miliion customers signed up to Monzo between April and June 2025
This led the bank to have the second-highest net switching gains of any bank for that period and was the first time since 2022 that Monzo was in the top three for net switching gains.
Some 13million customers now bank with Monzo in the UK, making it the biggest digital bank in the UK by customer numbers ahead of Revolut which has 11million UK customers and Starling with 4.6million customers.
It is now the seventh biggest bank in the UK by share of current accounts. One in five people in the UK bank with Monzo for their current account, some 12.5million people.
Experts have been taken by surprise by Monzo’s record growth over the three months, but say business customer growth, refer a friend bonuses and bank IT issues may have fuelled the rise.
Significant growth has come from Monzo’s business customers. It now serves one in eight UK businesses – numbering 700,000 business accounts.
Around 100,000 of the 1million customers who joined Monzo last quarter opened business accounts, meaning a seventh of all of Monzo’s business customers joined within the last three months.
Andrew Hagger says: ‘A Monzo lite business account doesn’t come with a monthly fee unlike most of the big banks where you’ll pay at least £8 or £10 per month, so you can see the appeal there especially to freelancers and one-man band operations.’
Bank IT outages such as Barclays at the beginning of this year may have driven some people to open a second current account, says Andrew Hagger – ‘so they don’t have all their eggs in one basket and can manage if there is a further outage in the future.’
Monzo expanded its product offering within the last year to launched 11 ETFs through Monzo Investments – an investing platform customers can use in their banking app.
It also launched an industry-first Undo Payments tool and started offering Home Insurance.
The digital bank now has 650,000 customers with its under 16 account.
Younger customers are especially valuable to banks as – if treated right – can become a customer for life.
Word of mouth referrals may have also helped Monzo to grow its customer base.
Two in three new Monzo sign ups come from word of mouth recommendations according to the bank. Monzo’s 13millionth customer, a woman in her 50s, signed up through a referral.
One of the main issues for banks is tempting customers away from other banks and using the new bank as their main account.
Andrew Hagger says: ‘Yes the Cass numbers have been net positive, but 8,000 plus in the last quarter is a drop in the ocean to the 1million in three months – I do wonder if people are opening second bank accounts with Monzo as I don’t think there is any requirement that you have to pay in a minimum amount per month.’
Around a third of customers now use Monzo as their main bank account, which is up from 23 per cent a year ago.
For Monzo, this has translated to customer deposits rising 48 per cent to £16.6billion in the financial year to 31 March 2025.
Revenues also grew 48 per cent to £1.2billion and adjusted profit before tax surged to £113.9million, up from £13.9million.
TS Anil, chief executive of Monzo, said: ‘Monzo has achieved a rare feat – we’ve built a bank that customers love.
‘And that love continues to power huge growth, with two-thirds of new sign-ups coming from word-of-mouth recommendations. It’s incredibly exciting to see Monzo Business also growing rapidly as Monzo becomes the bank of choice for SMEs.’
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