Value of Monese slashed amid fintech rout

A MAJOR investor has slashed the valuation of international payments app Monese as it seeks an injection of extra cash.

The value of the London-based financial technology company, which has two million customers, has been marked down by a third by the Swedish fund Kinnevik.

A wave of valuation cuts is hitting fintech companies prompted by higher interest rates and the economic slowdown as they seek to challenge the traditional big banks, with major players such as Revolut and Klarna among those affected.

In its most recent financial filing for 2023, Kinnevik revalued Monese to about £205m, down from £320m a year earlier. Kinnevik owns about a fifth of Monese, which admitted in accounts filed earlier this month that there was a “material uncertainty on the success of future fundraising” as the loss-making business sought further cash.

Its auditors warned the need for further funds cast significant doubt over its status as a going concern.

The latest accounts for Monese, also backed by HSBC, Paypal and British Airways, show it posted a loss of £30.5m in 2022 on revenues of £27.7m for the year.

Monese offers a payments app that provides international money transfers and current accounts.

It also sells its technology to other businesses. HSBC invested in the company in 2022 and this month launched its own foreign exchange app, called Zing, which reportedly relies on Monese’s back-end technology. Monese has raised more than £200m and at one stage had reportedly been seeking a valuation as high as £1bn.

The British taxpayer also holds a small equity stake in Monese after it was supported by Rishi Sunak’s Future Fund during the pandemic.

A Monese spokesman said Kinnevik’s investment report pointed to a challenging market environment and did not single out Monese. The spokesman added: “Monese enters 2024 in a positive position on the back of a strong performance throughout 2023.”

Norris Koppel, Monese’s chief executive, said earlier this month: “The directors expect the company will be successful in raising additional funds to implement its strategy; and the external auditors conclude that the directors’ use of the going concern basis of accounting in the preparation of the financial statements is appropriate.”