Zopa Bank swung to its first annual profit in 2023 as the fintech continues to consider a hotly anticipated float on the London Stock Exchange.
Zopa notched a profit of £15.8m in 2023, swung from a loss of £26m in 2022. Its customer base swelled to over 1m reflecting its “newly expanded product offering” while its deposit base increased 14.9 per cent to £3.4bn.
The results mean Zopa has hit annual profitability much faster than many of its rivals, having secured its banking licence in 2020. Unlike some of its fintech lending peers, Zopa has taken a more restrained approach to growth and focused on delivering profitability.
The bank said its profitability was not reliant on the higher rate environment, but reflected sustainable customer growth. Lending increased 27 per cent to £2.7bn in 2023.
Following its strong year, Zopa is planning on offering current accounts to its existing customers before expanding the product to new customers next year.
“2023 was a landmark year as we achieved our first full year of profitability, grew to over a million customers, and maintained our market leading net promoter score,” Jaidev Janardana, CEO at Zopa Bank said.
“Across all our products, the opportunity is huge and we remain passionate about changing customers’ relationship with money for the better,” he continued.
The results come as the fintech considers a widely anticipated IPO. A string of senior executives have joined the bank in recent months to build up its regulatory and public markets expertise in preparation for the IPO.
The bank told City AM last summer that it “remains favourable” to listing in London, but Janardana told the Financial Times he’d be “surprised” if there were fintech IPOs in London this year.
The firm completed two £75m funding rounds in 2023 in an attempt to beef up its balance sheet.