Revolut announced on 20 July 2023 that it has received a preliminary banking license from the UK’s Prudential Regulation Authority (PRA), marking a significant milestone in the fintech firm’s journey. This approval, which follows a rigorous three-year application process, represents a crucial step towards Revolut’s ambition to become a leading bank in the UK.
“We are incredibly proud to reach this important milestone in the journey of the company and we will ensure we deliver on making Revolut the bank of choice for UK customers,” said CEO Nik Storonsky in a statement.
The approval from the PRA comes with certain restrictions during a “mobilization” stage before Revolut can obtain a full banking license. During this period, the fintech firm is limited to a £50,000 ($64,000) cap on total customer deposits. Revolut informed its UK-based customers, stating, “We are now entering a ‘mobilization’ period, a common regulatory stage for many new banks. During this period, we will complete the setup of our banking processes before beginning operations as a bank in the UK.”
Once fully operational, Revolut will be able to offer a broader range of products such as mortgages and credit cards, in addition to its existing e-money services. This expansion is expected to significantly enhance Revolut’s service offerings and market position.
Founded in 2015, Revolut initially launched in the UK, offering money transfer services. The company has since expanded its services to include buying, holding, and exchanging cryptocurrencies, making it one of the UK’s largest fintech companies. As of now, Revolut serves around 9 million customers in the UK and more than 45 million globally. The company reported a remarkable financial performance in 2023, recording a £344 million profit, a substantial increase from £6 million the previous year, with revenues nearly doubling to £1.8 billion.
The approval of Revolut’s banking license is expected to have a significant impact on the cryptocurrency sphere. By offering banking services alongside its crypto trading platform, Revolut can provide a seamless experience for crypto enthusiasts, integrating traditional banking with digital asset management. This move could attract a broader customer base and foster greater trust in the use of cryptocurrencies, as they will be supported by a regulated banking institution. Moreover, it sets a precedent for other fintech firms looking to bridge the gap between conventional finance and the burgeoning crypto market. Revolut’s progress is a proof to the growing acceptance and integration of cryptocurrencies within mainstream financial services.
