Revolut gets full UK banking licence after years-long wait

LONDON – Revolut, Europe’s most valuable start-up, said on March 11 that it had received regulatory approval to launch a British bank, allowing it to compete head-to-head with high-street lenders in areas such as current accounts and consumer lending.

The London-based financial services firm, which has amassed 13 million customers in Britain but has no physical branches since it was founded just over a decade ago, was granted a banking licence with restrictions in July 2024 after a three-year wait.

Mr Nik Storonsky, Revolut’s co-founder and chief executive, has said that getting a licence in its home market was his top priority.

Revolut said in a statement that the Bank of England’s Prudential Regulation Authority had allowed it to end its “mobilisation” phase, which had lasted longer than the usual 12-month limit.

This allows Revolut to offer protected deposit accounts and “paves the way for a wider range of services in future, including lending and other products”, the company added.

The Financial Times previously reported that the licence was held up over regulators’ concerns about whether its risk controls could keep pace with the rapid growth of its overseas operations.

Revolut will now take on Britain’s incumbent banks, including Barclays, Lloyds and NatWest, and said it expects to start rolling out current accounts to new clients “in a few days”.

It predicted that the process of moving customers to the new bank would take “a few months in total”.

“Launching our UK bank has been a long-term strategic priority for Revolut and marks a significant moment in our journey. The UK is our home market and central to our growth,” Mr Storonsky said.

Founded in 2015, Revolut has grown rapidly worldwide over the last decade, with more than 65 million customers globally and a US$75 billion (S$95.7 billion) private market valuation.

Its strategy has been to attract customers who use it as a secondary bank account for services, including payments and foreign exchange transactions, then offer them perks such as subscriptions, Revolut’s outgoing US CEO said last week.

A crypto boom helped its profit in 2024.

Despite its growth, analysts say average customer deposits at Revolut are lower than at traditional banks, and executives have said too few use it as their primary account.

Revolut already has a banking licence in Lithuania, which it uses as a “passport” into the European Union, and is seeking a licence in France. It has also applied for a US bank charter.

“The full licence will open the door to balance sheet-driven products and sharpen pressure on both traditional banks and the cohort of challenger banks,” Mr Elliot Reader, director in Houlihan Lokey’s FinTech Group, said of the British development. REUTERS