From CNBC: 2025-05-13 01:01:00

Financial technology firms initially suffered due to interest rate hikes in 2022, but saw profits rise in 2024. Robinhood reported $1.4 billion in profit, Revolut saw a 58% jump in net interest income, and Monzo reported its first annual profit. Fintechs now face challenges as interest rates decline, impacting income strategies.

As interest rates fall, fintechs like Robinhood and ClearBank are adapting to diversify revenue streams. Robinhood reported $290 million in net interest revenues in Q1 2025, while ClearBank saw a pre-tax loss due to a shift towards fee-based income. Fintechs with diverse income streams are better positioned to navigate changing economic conditions.

Revolut and Bunq are examples of fintechs diversifying revenue sources. Revolut offers crypto and share trading, while Bunq targets digital nomads with subscriptions and card-based fees. Neobanks with diversified income streams are better equipped to handle a lower-rate environment, according to industry experts.

Read more: Fintechs that made profits from high interest rates now face key test