Following the news that British fintech Revolut has received its UK banking license with restrictions from the Prudential Regulation Authority (PRA);

Benjamin Hatton, Banking and Payments Analyst at GlobalData, a leading data and analytics company, offers his view:

“Revolut has been seeking a banking license in the UK for several years now. Having finally allayed concerns over several facets of its global organization, the bank will be looking to kick on in other jurisdictions as part of its global expansion strategy. This announcement comes at a perfect time for Revolut, with reports the bank is planning a share sale valuing the company at over $40 billion. With the extra weight of a full UK license behind it, Revolut may be able to justify being labelled as one of the most valuable fintechs in the world.

“With Revolut now able to take customer deposits, the fintech will likely look to break into new revenue channels, particularly lending streams which are a particularly fruitful endeavor for banks at the moment. It is unlikely to be all plain sailing, though, as extra regulatory hurdles and deposit protection measures will also weigh up against the bank’s future targets.

“Revolut will hope it can catch up with other leading fintechs in the UK, including Monzo and Starling, which are beginning to become real contenders within the UK banking space. Over 3% of UK consumers consider one of the two fintechs to be their main bank, according to GlobalData’s 2024 Financial Services Consumer Survey*. Further competition in the market is no bad thing, driving improvements in competitors which are now challenged with competing with yet another digital innovator. Having established itself across several leading markets around the world in recent years, including Europe, Mexico, New Zealand, and the US, Revolut promises to become the global player it has promised for so long.”

*GlobalData’s 2024 Financial Services Consumer Survey was run in Q2 2024 with a sample size of 67,292 across 41 countries (UK sample 5,003).