Britain’s Revolut filed a formal application for banking licensing this week. Established British banks are bracing for rule changes domestically and internationally, as more digital-only banks are ever-closer to legal parity with legacy institutions.
Without a License, Britain’s Digital-Only Revolut Has Nearly One Million Customers
“Even without a banking license, we have attracted over 950,000 users across Europe,” Nikolay Storonsky, digital-only bank Revolut‘s founder and CEO, told Reuters, “many of whom consider Revolut as their primary current account and spending card.”
Banking law changes from the European Union (EU) and Britain are coming fast in an effort to make the stodgy and notoriously clubby industry more competitive. The EU fears a resilient United Kingdom financial technology (fintech) insurgency in the wake of Brexit. British banking authorities worry policies designed to protect insiders might stall its growing competitive fintech advantage.
These add up to an over-the-shoulder-looking few years ahead for legacy banks, as digital-only banks apply for formal licensing, which Revolut has done. The company joins already-licensed digital-only banks N26, Starling Bank, and Monzo who are looking to take advantage of the rule-loosening, enabling them to tap into customer data long held exclusively by big banks.
Significantly, fintech lender “Cashplus said last week it was considering applying for a UK banking license, while telecoms giant Orange has launched its own bank in France in a bid to steal established lenders’ market share by capitalizing on the rise of smartphones,” Reuters also reported.
Beyond Banking with Bitcoin
Revolut’s license will be secured through the Bank of Lithuania, the country’s central bank, and the company plans on Read More Here