Revolut’s Banking License Delayed
Revolut, the British fintech firm, is facing another setback in its quest to become a fully-fledged bank in the UK. Currently, its full banking license is pending due to the central bank’s concerns about the ability of startups to manage risks amidst rapid international growth.
As reported, the Bank of England is looking for a solid risk management framework before it can approve the banking license. This is part of a broader investigation into the management practices of fintech companies operating both in the UK and abroad.
Although Revolut secured a UK banking license over a year ago, it remains in a mobilization phase. This phase usually lasts about 12 months and comes with deposit restrictions as the bank finalizes its establishment while the Prudential Regulation Authority and the Financial Conduct Authority evaluate its readiness to operate fully.
Getting this full banking license is crucial for Revolut. It would allow the company to start lending in the UK and manage customer deposits exceeding £50,000. With around 12 million customers in the UK, this step is pivotal for the company’s growth.
News of this delay arrives as Revolut, boasting over 65 million customers globally, is pushing forward with its international expansion. The company already holds a banking license in the EU and operates in several countries, including Australia, Japan, New Zealand, Singapore, Brazil, and the United States. It’s also looking to enter markets in India, Colombia, Argentina, and Mexico by 2026, with aspirations to venture into Africa.
Revolut has ambitious plans, aiming for 100 million customers by mid-2027 and expansion into more than 30 new markets by 2030. A spokesperson has stated that they’re progressing through the final steps of mobilization and are committed to working closely with the PRA. They emphasized the complexity of this process, noting that while timelines are important, thoroughness holds greater significance.
In its recent annual report, Revolut announced a net profit of $1 billion (£790 million) in 2024, marking a 72% increase in sales, which reached $4 billion (£3.1 billion).
