Lack of UK Bank License Thwarts Revolut’s Super App Ambition

Revolut’s quest for a U.K. banking license is the critical piece missing for the $33 billion FinTech to achieve global super app status but, its crypto approach and the war in Ukraine have stopped the process from moving forward.

Co-founder and CEO Nikolay Storonsky had hoped to have a license buttoned up by the start of this year but British regulators are still on the fence and the Russian attack on Ukraine has only thrown another obstacle in the works, Bloomberg reported on Friday (May 6).

Headquartered in London and founded in 2015 by Storonsky and CTO Vlad Yatsenko, Revolut began as a prepaid card offering low-cost foreign-exchange fees. The company quickly expanded its product and service offerings and branched out geographically.

While the company already offers money transfers, store purchases, share trading and pet insurance in the U.K., a bank license would enable Revolut to offer loans and overdraft protection.

Revolut was granted a bank license for the European Union last year and operates as a bank in 10 markets — Belgium, Denmark, Finland, Germany, Iceland, Lichtenstein, Luxembourg, Netherlands, Spain and Sweden. The U.K. and the U.S. are central territories.

The FinTech applied for a banking license in the U.S. last year. At the time, Storonsky said that obtaining a U.S. license was an integral part of the journey to “build the world’s first global financial superapp.”

See also: Revolut Bank Granted Full EU Banking License Amid Criticisms of Unfair Competition

In the U.K., regulators’ concerns over Revolut’s crypto trading unit center on the way the company approaches transaction monitoring and know your customer (KYC). An unnamed source told Bloomberg that Revolut has had to deal with multiple contacts at the Financial Conduct Authority (FCA) and each time start from the beginning.

“We take our regulatory and compliance obligations extremely seriously,” a Revolut spokesman says. “We have constructive, productive relationships with over 22 regulators around the world and … our relationships with U.K. regulators are among the most long-standing.”

The war in Ukraine also brings attention to the company’s Russian ties. “We’re not in normal circumstances,” Maria Demertzis, of the Brussels think tank Bruegel, told Bloomberg.

Storonsky is Russian and Yatsenko is Ukrainian and both have British passports. Revolut has an office in Moscow that is in the process of closing, according to a person familiar with the plan.