Challenger bank Monzo is aiming to raise between £50m and £100m in a new round of investment early next year.
The app-only bank is in talks with new and existing investors, including large City institutions, and could hold its next series of fundraising in 2020, according to a source close to the company.
The move comes after Monzo raised £113m in new equity capital from specialist venture capitalists in June. The deal doubled the valuation of the the digital bank to over £2bn just eight months after it was valued at £1bn.
Since then the bank has continued its rapid growth, now boasting 3.5 million customers, 55,000 sign-ups a week, and 1,500 staff.
Monzo was founded as an app-only bank by British entrepreneur Tom Blomfield in 2015. It is known for its eye-catching “hot coral” coloured debit cards and its app which sorts cash into different pots. It has become popular with users, particularly those under 40, who are attracted to features such as instant spend notifications, the ability to turn cards on and off, and a Facebook-like feed of transactions.
The bank said in September that almost £50,000 was spent via its platform every minute and £18bn had been spent by Monzo users so far.
Startup challenger banks such as Monzo and rivals such as Starling and Revolut have been effective at attracting users with their customer-friendly branding and perks such as cheap foreign exchange transactions.
Monzo’s latest fundraising comes after news of a potential deal that will see digital bank Revolut valued at just over £6bn.