Revenues at TransferWise, the closely watched online money transfer firm, climbed 53% to £179m ($223m) in its most recent financial year, the company said on Wednesday.
In a business update, the fintech startup said that it made after-tax profits of £10.3m in the year to the end of March.
That marks the firm’s third straight year in the green — rare in a sector that tends to focus on rapid user growth over profitability.
Founded in 2011, TransferWise initially billed itself as an easy and cheap way to send money overseas online.
The London-based firm now offers “borderless” bank accounts in more than 170 countries, and says that 10,000 new business customers join every month.
TransferWise processes £4bn worth of payments every month, and says it saves customers around £1bn in transaction and conversion fees compared to traditional banks.
The company now holds more than £1bn on deposit for customers, and has partnered with France’s second-largest bank, BPCE, as well as UK challenger bank Monzo.
“Eight years in TransferWise continues to see phenomenal growth, and it’s our duty to manage that responsibly and sustainably,” said Kristo Käärmann, CEO and co-founder of TransferWise, in a statement.
“Fintech has proven ten times over that it can offer consumers a next-level experience at a low price, but we believe the magic is found in building a solid business that can be trusted long-term,” he said.
“Our financial results prove that TransferWise team has cracked that formula.”
In May, TransferWise raised $292m (£234m) in secondary funding, valuing the company at around $3.5bn.
That valuation put it ahead of N26, whose January 2019 funding round valued the German challenger bank at $2.7bn.
But co-founder and chairman Taavet Hinrikus told Yahoo Finance UK that he thought it was “a little bit too childish to focus on being the most valuable” fintech firm.
Meanwhile Revolut, another London-based fintech startup, is expected to close its latest funding round by the end of the year.
Revolut CEO Nikolay Storonsky has said that the resultant valuation is likely to be “much higher” than that of TransferWise.
By being profitable, TransferWise is bucking a broader trend in the fintech sector. Challenger banks like Revolut, Monzo, and N26 have yet to turn a profit.
Controversially, N26 co-founder Maximilian Tayenthal said in July that his company did not see profitability as a “core metric”.
TransferWise makes its money by taking a small percentage of each transaction.
While competitors like Revolut also offer currency conversion at competitive rates, they have found it more difficult to make money from their primary offerings, which centre around deposit accounts.
In August, Monzo began lending to customers by launching its first range of personal loans.