Banking News

Revolut Plans Aus Bank Licence as UK Licence Faces Rejection

(19 May 2023 - Global) Fintech giant Revolut has launched multi-currency business accounts in Australia and signalled its intention to obtain a banking licence in the country.

The new business account allows firms to exchange up to A$75,000 per month, with head of Revolut Business James Gibson telling The Australian that "Australian SMEs have been largely under-served when it comes to FX and anything international".

Matt Baxby, CEO, Revolut, adds: "What we hear a lot from them is that they really want a solution that allows them to do business overseas. And we have a lot of European customers who have Australian subsidiaries and vice versa, so we think we're going to get quite a lot of traction with that."

Meanwhile, says Baxby: "A bank licence is still very much part of our plans. To be held to that regulatory standard would give our consumers confidence for the long haul, and would enable products that are in demand from our customers. We're working our way through that, and it's a key part of our plans overall."

Any Australian licence could depend on whether the company secures a UK one. Earlier this month, CEO Nik Storonsky said the fintech's two-year quest to secure the UK licence is now being held up by "extra cautious" regulators spooked by recent events at the likes of Silicon Valley Bank and Credit Suisse.

According to reports in the FT and the Telegraph the Bank of England's Prudential Regulation Authority (PRA) told the Treasury in March that it planned to issue a statutory warning to the firm over concerns about the company's balance sheet. 

Following a six-month delay, Revolut finally filed its accounts in March. However, auditor BDO flagged concerns that it could not verify £477m of revenue, nor vouch for their “completeness or occurrence”, due to the configuration of Revolut's internal IT systems.

The warning has not yet been issued and Revolut is in urgent talks to rescue the licence, despite at one point offering to withdraw its application, according to reports.