Monzo is reportedly planning to launch a record £20 million crowdfunding round as it eyes up a coveted $1 billion valuation from new investors.

The digital challenger bank is said to be mulling the equity crowdfunding drive, which would see existing customers offered the chance to participate in the UK’s largest crowdfunding round to date via its mobile app, City AM reported.

The bank is expected to engage Crowdcube, the UK-based crowdfunding platform that has helped it raise more than £4 million from crowdfunding investors on previous occasions.

The £20 million target exceeds a £7.2 million EU-imposed cap and will therefore be required to build a formal prospectus to issue to potential investors, the paper reported.

The move comes as Monzo is targeting a reported £100m at its next traditional fundraising round, taking it closer to a $1 billion valuation from new investors. If achieved, the valuation would take the digital bank into unicorn startup territory.

Despite high hopes for the upcoming valuation, the bank is still yet to make a profit. Its annual report revealed pre-tax losses of £33.1million, up from £7.9million in 2017, primarily as a result of an increase in operating costs.

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