Revolut Applies for Post-Brexit British Banking License -- Financial News

By Emily Nicolle

Of Financial News

Digital bank Revolut said it has applied for a full banking license in the U.K., submitting its application to the Financial Conduct Authority and the Prudential Regulation Authority this month.

The transition to a full license from its existing e-money permissions will allow Revolut to lend: offering overdrafts, loans and deposit accounts, thus building up a strong source of revenue.

It is also hoped that the license will convince its customers to start receiving their salaries into their Revolut accounts. The digital bank said around half of its users had said they would do so if their cash was protected by the deposit insurance that comes with a full banking license under the Financial Services Compensation Scheme.

Revolut currently operates in the U.K. on an e-money license, while funds from British accounts are held by other big banks such as Barclays PLC. Elsewhere it has a full banking license in Lithuania, which allows it to operate as a bank across central Europe. The beginning of the U.K.'s existence outside the EU on Jan. 1 means Revolut can no longer passport the rights of this license into the U.K.

"A U.K. banking license allows us to provide the essential financial products U.K. customers expect from their everyday primary bank account, such as loans, credit cards, overdrafts and deposit accounts, coupled with the additional trust and security that is offered through FSCS protection," said co-founder and chief executive Nik Storonsky Monday.

"In the future, we want to offer many more innovative products to our U.K. customers and we are excited to continue driving innovation and competition in the banking industry. Becoming a fully licensed bank in the U.K. is a central pillar of that ambition."

Revolut had recently brought on a number of banking heavyweights to support its goal, including former Standard Chartered European boss Richard Holmes as a board adviser. He is in charge of developing a leadership team for Revolut's bank proposition.

The digital bank has been chasing ways to make money since it was launched in 2015, having been loss-making for the vast majority of that time. Revolut briefly reported a single month of profit in 2018, followed by two months on consecutive profit in November and December last year.

Valued at $5.5 billion through a number of venture capital rounds, Revolut has more than 13 million users worldwide in more than 36 countries. It has more than 2,000 staff, 800 of which are based at its Canary Wharf global headquarters in London.

Website: www.fnlondon.com

(END) Dow Jones Newswires

January 11, 2021 04:52 ET (09:52 GMT)

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