UK regulator delays Revolut’s full banking licence
The Prudential Regulation Authority (PRA) is holding up approval of Revolut’s full UK banking licence, citing concerns that the fintech’s risk controls may not be able to keep pace with its rapid international expansion.
Bank of England officials have asked Revolut for formal commitments to strengthen risk management across its global operations before a full licence is granted, according to the Financial Times. The PRA oversees capital, liquidity and operational/IT resilience.
Revolut was granted a UK banking licence in July 2024 but remains in a mobilisation phase that has lasted more than 14 months. While in mobilisation, the fintech’s banking arm can hold only £50,000 of total deposits. A full licence would allow Revolut to lend to UK customers and put those deposits to work in the lending market.
Regulators are treating the case cautiously because approval for a firm of Revolut’s scale could lead other regulators to follow. Revolut reported about 65 million customers across roughly 40 countries and has said it plans to enter 30 more countries by the end of the decade as it aims for 100 million customers.
At a recent event, co-founder Nik Storonsky described a full UK licence as Revolut’s “number one priority” and acknowledged the company had previously prioritised growth over obtaining full banking licences. He said the firm had tried to “shortcut our banking licences” by using lighter e-money and payments regimes.
Revolut has banking authorisations in the EU via Lithuania and in Mexico. Colombian authorities authorised the company to set up a bank, though further approvals are needed before it can begin lending there. The company is also exploring acquiring a US bank to gain a national charter and conduct a public offering of shares.
The company declined to comment directly and pointed to a previous statement saying it is “progressing through the final stages of mobilisation” and working “constructively with the PRA.” The PRA declined to comment.
Regulators are treating the case cautiously because approval for a firm of Revolut’s scale could lead other regulators to follow. Revolut reported about 65 million customers across roughly 40 countries and has said it plans to enter 30 more countries by the end of the decade as it aims for 100 million customers.
At a recent event, co-founder Nik Storonsky described a full UK licence as Revolut’s “number one priority” and acknowledged the company had previously prioritised growth over obtaining full banking licences. He said the firm had tried to “shortcut our banking licences” by using lighter e-money and payments regimes.
Revolut has banking authorisations in the EU via Lithuania and in Mexico. Colombian authorities authorised the company to set up a bank, though further approvals are needed before it can begin lending there. The company is also exploring acquiring a US bank to gain a national charter and conduct a public offering of shares.
The company declined to comment directly and pointed to a previous statement saying it is “progressing through the final stages of mobilisation” and working “constructively with the PRA.” The PRA declined to comment.
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