Fintech giant Revolut has achieved a notable milestone by securing a banking license with limitations from the UK’s Prudential Regulation Authority (PRA). This accomplishment comes after over three years of rigorous efforts in the license application process, marking a crucial step in Revolut’s transition into a fully-fledged bank. The approval initiates the “mobilization phase,” a period during which Revolut will operate under specific restrictions before gaining full banking capabilities.
How Significant Is the Mobilization Phase?
The mobilization phase is essential as it allows Revolut to start operating with certain constraints while adhering to PRA’s requirements. This period is crucial for new banks to set up operations, systems, and procedures under regulatory oversight. For Revolut, this means commencing banking services under stringent conditions, eventually aiming to become a fully operational bank.
A key aspect of Revolut’s journey to becoming a licensed bank is its ongoing involvement in cryptocurrency services. The company has been prominent in the fintech sector, enabling users to trade cryptocurrencies. Earlier this year, Revolut expanded its crypto offerings by launching a dedicated cryptocurrency exchange for seasoned traders, bridging traditional banking and emerging digital currencies.
What New Services Will Revolut Offer?
The banking license significantly boosts Revolut’s credibility and opens avenues for expanding its financial services range. Now as a licensed bank, Revolut can offer a wider array of products, such as loans and mortgages, enhancing its market appeal. This strategic expansion is expected to attract new customers and bolster the company’s market share in the competitive financial landscape.
Key Takeaways for Users
– Revolut now holds a banking license from the UK’s PRA.
– During the mobilization phase, it will operate under limited conditions supervised by the PRA.
– The company plans to broaden its financial services, including traditional banking products.
– Expanded service offerings will help increase Revolut’s market presence.
In addition to obtaining the banking license, Revolut plans to sell $500 million in shares owned by employees. This move is anticipated to elevate the company’s valuation to $45 billion, reflecting its robust growth and investor confidence. The share sale aims to provide liquidity to employees while aligning their interests with the company’s long-term objectives.
