ClearBank is clearing up according to the company’s latest financial results, which revealed strong growth in terms of both revenue and profit despite acknowledging some challenging market conditions.
The London-based fintech, which specialises in real-time clearing and embedded finance services, reported revenue of £111.3m, an increase of 91% on £101.3m the year prior, driving the company to reach profitability for the first time.
Full year pre-tax profits stood at £18.4m in comparison to a loss of £7.1m the year prior. According to ClearBank this has been driven by a significant expansion of its client-base, with payment volume rising 54% year-on-year to 108 million, as well as a surge in Open Banking transactions.
“2023 has been a stand-out year for ClearBank,” said Charles McManus, CEO, ClearBank. “While the industry and the broader economy have faced significant challenges, our values of innovation and sustainable growth have led to our first full-year of profitability – an incredible milestone in our journey.”
“We have been able to offer resilience and stability in an uncertain market, building services our customers need, including a best-in-class embedded banking offering. But this is just one step on the journey, not the finish line.”
ClearBank’s model sees funds held at the Bank of England, which the firm believes makes it more attractive to clients to increase protection and provide better returns, with £6.1bn currently held in deposits, 103% more than in 2022.
The firm has highlighted a boost in embedded banking end-customers in 2023, with this client base rising by 93% to 1.2 million. Leveraging of embedded finance is rising in general – a report from Juniper expects the market to grow significantly between 2024 and 2028, for example.
Meanwhile, ClearBank has also benefited from gaining traction among some of the UK’s emerging banks, including the country’s new market entrants Allica Bank and Alba Bank, as well as growth in fees by 54% as a result of new embedded banking and agency clients and the aforementioned greater transaction volume.
Looking ahead, the company intends to further embrace innovation by building on the addition of CASS for account switching, use of Confirmation of Payee-as-a-Service and adoption of a new cross-border GBP service in 2023.
“ClearBank has not just achieved profitability, it has done so through deliberate, purposeful, and sustainable growth,” said Mark Fairless, CFO, ClearBank.
“Our success enables the success of others in the market, whether through our partnerships with so many new banks, or our embedded banking platform offering interest-bearing accounts held at the Bank of England.
“Our success in 2023 places us in an excellent position for 2024 – we have more customers in our pipeline than ever before, and we expect this to translate into significant growth in our recurring revenues.”
