Revolut Applies for Post-Brexit British Banking License -- Financial News
January 11 2021 - 5:07AM
Dow Jones 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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