Nutmeg is the largest European pure online digital wealth manger by far, and one of the fastest-growing wealth managers in the UK, but its profitability is nonetheless suffering mightily because of burdensome financial regulations, according to its recent report to Companies House.

According to its recently published strategic report for the year ended 31 December 2017, the firm passed the £1 billion mark in terms of assets under management last year. It reports, however, that additional regulatory rules were a problem in that year, forcing the business to devote significant resources to beef up its controls and prepare for the European Union's second Markets in Financial Instruments Directive, which came into force on 3rd January this year. The developments that this mega-law required "drew on resources from almost every area of the business throughout the second half of 2017." The changes that Nutmeg had to make were broad and complex and the sacrifices that it made were, according to the report, typical of those made by small wealth managers in general. Nutmeg says that it observed the regulatory deadline - something that thousands of firms did not.

The General Data Protection Regulation was another bugbear, requiring a comprehensive review of data classification, storage, encryption, recordkeeping and management of suppliers.

The board of Nutmeg delegates risk management oversight to the compliance and risk committee, which meets six times a year with board members in attendance.

Nutmeg's turnover was £2.55 million in 2016, rising sharply to £4,56 million last year. Its operating loss was £9,38 million in 2016, also rising sharply to £12.35 million last year.