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Revolut, the British fintech startup, has officially secured a banking license from the UK’s Prudential Regulation Authority (PRA), ending a three-year wait. The license, which comes with certain restrictions, allows Revolut to develop its UK banking infrastructure and operations before launching its full suite of services.
The company, headquartered in London, first applied for the license in 2021. Delays primarily stemmed from issues with Revolut’s share structure, which did not align with the PRA’s regulations. British regulators required Revolut to consolidate its six classes of shares into ordinary shares, a requirement the company has now met through a restructuring deal with major Japanese tech investor SoftBank.
With the new banking license, Revolut is set to offer traditional banking products such as customer deposits, loans, and credit cards. The firm joins other challenger banks like Monzo and Starling in competing with established players like Barclays.
Francesca Carlesi, Revolut’s UK CEO, highlighted the significance of the license, stating, “Today’s announcement is a significant step forward for Revolut and for our customers. It is a tremendous responsibility to be a bank in the UK and we will work relentlessly to offer products and services that improve the financial lives of everyone who uses Revolut.”
Revolut’s financials showed marked improvement in 2023. The company reported a pre-tax profit of £438 million ($545 million) for the year, a turnaround from a pre-tax loss of £25.4 million in 2022. Group revenues surged by 95% to £1.8 billion, up from £920 million the previous year.
The license marks a pivotal development for Revolut, enhancing its ability to compete in the UK banking sector and expand its offerings to customers.