British fintech startup Revolut has finally gotten its UK banking license from the Prudential Regulation Authority (PRA) after waiting three years. The license was given to a part of Revolut Group Holdings Ltd., so the company won’t switch its UK customers over right away but will keep working as an e-money institution regulated by the Financial Conduct Authority. Antoine Le Nel, Chief Growth and Marketing Officer & Partner at Revolut, shared this news on LinkedIn.
Revolut’s co-founder and CEO, Nik Storonsky, expressed pride in achieving this milestone and emphasized the company’s commitment to becoming the preferred bank for UK customers.
Although Revolut secured a banking license in the European Union in 2018 with assistance from the Bank of Lithuania, acquiring a similar license in its home country has been more challenging. The company has been pursuing this goal since 2021, and the lack of a UK banking license has previously limited its growth, particularly in offering credit products like personal loans, overdrafts, and credit cards.
For Revolut customers, the new banking license signifies upcoming improvements and expanded services. However, immediate changes are not expected as the company is currently in the “mobilization” stage, which includes certain restrictions.
This stage can last several months but typically does not exceed 12 months. One major restriction during this period is that the bank cannot hold more than £50,000 in total customer deposits, which may limit some of its operations temporarily.
Revolut, founded in 2015, boasts over 45 million customers globally, with 9 million in the UK alone. The company reported substantial financial growth in 2023, with $2.2 billion (£1.8 billion) in revenue and $545 million (£438 million) in pre-tax profit.
This period also marked the first time in three years that Revolut published its audit reports, signaling a move towards greater transparency, which may have positively influenced the PRA’s decision to grant the banking license.
Revolut’s acquisition of the UK banking license marks a crucial step in its expansion and ability to offer a broader range of financial products to its customers. The company is poised for significant growth and development as it transitions through the mobilization stage and begins to leverage the full benefits of its new banking status.
