Revolut Just Acquired a UK Banking License

• Revolut app launched in 2021 and reached ~40M users today
• After three years of waiting, they got a UK banking license
• It allows to hold UK customer deposits, opening up new revenue streams
• Further, they will need to provide a deposit guarantee and adhere to other regulations

What UK Bank Licence Provides Revolut With?

This license allows Revolut to hold customer deposits, opening up new revenue streams through its own-branded loans and mortgages. However, while this is a big step, it is not the only one for the regulators. They still have to guarantee customer deposits up to £85,000.

The review took over three years as Revolut has had some concerns from EU regulators to question it. However, this did not stop Revolut from delivering banking operations before a formal launch at a high enough level to become the biggest and most valuable fintech startup in the UK.

Why Is Revolut's Example So Important?

Revolut emerged as just another fintech startup just a couple of years ago, but over £250 billion has been transacted on Revolut in 2023, and the user base has reached ~40 million. Revolut continues to grow rapidly and expand its user base beyond the UK and EU, and getting a UK license should greatly help build trust and get regulatory approval in other jurisdictions.

For example, Revolut's user base is growing in the US, having already gained 0.8 million users as early as 2023, and it is also growing in Canada and Australia.

This may tell us that traditional financial institutions and services are insufficient for the actual user's needs, which allows young fintech startups using modern technologies and approaches to reach extremely impressive numbers in record terms.

Conclusion

Revolut's amount of transactions and user base, regardless of licenses, may suggest that the benefits fintech offers are critical and that users will use the best of what is available on the market. So regulators have no choice but to eventually reckon with the new player's significance.