Barcelona-based corporate neobank Neo has hit profitability and says it is unlikely to need external funding to grow its business in Europe.
The cross-border payments and FX fintech reported €1 million in profit in 2023, compared to a €1 million loss in 2022.
It says its reversal into the black comes as a growing number of SMEs look for alternatives to legacy banks for managing their international business needs.
Neo, which provides multi-currency accounts for corporate treasurers and has more than 300 corporate customers across Europe, reported revenues of over €5 million in 2023.
It offers International Bank Account Numbers (IBAN) through which businesses can send and receive payments in 25 currencies.
It argues that its offering makes it easier for SMEs to organise their funds and store multiple currencies, compared to rivals, while it also points to its client support as giving it a competitive advantage.
The fintech is backed by South Africa-based Skybound Capital and has raised nearly €12 million to date.
Laurent Descout, co-founder and CEO of Neo, said:
“Turning Neo into a profitable fintech was our main objective for 2023”, adding that its profitability helped Neo stand out against some VC-backed fintechs."
But he said the bank, which also has staff in the UK among its 30-strong overall team, could look for external funding to launch in new markets.
“We definitely do not think we will need external funding to go on growing our European business. We may be looking for new funding partners to start launching non-EU activities. We are very much looking at Singapore and Asia setting up our own office there with our own licence.”