MONZO has secured a new $430m (£339m) funding round led by Alphabet-owned CapitalG, valuing the digital challenger bank at $5bn (£3.9bn).

The firm was previously valued at $4.5bn (£3.5bn) in 2021 after a funding deal with investors including Tencent, the Abu Dhabi Growth Fund, Coatue and Accel.

Other backers in the new funding round include Chinese venture capital firm HongShan and existing investors Tencent and Passion Capital.

Chief executive TS Anil said Monzo would use the funding to return to the US market. In 2021, the country's regulators told the firm, which is a fully licenced bank in the UK, that it was unlikely to secure a US licence.

Monzo hired a new US chief executive last year and has put forward plans to expand into the market by partnering with banks that are licenced there.

Anil said in December that there was a "huge gap" in the US, which was "very large with attractive economics". He added: "And it's one of the few markets in the world where you don't need share to get scale."

(c) 2024 City A.M., source Newspaper