The fate of Revolut’s bid to secure a long-awaited banking license from city regulators was thrown into further doubt last night after it emerged that the Bank of England was intent on rejecting the company’s application.
The London-based group is the darling of Britain’s fintech industry and has been seeking approval for a license from the bank’s prudential regulator and Financial Conduct Authority for more than two years.
However, a source said last night that the PRA had told the Treasury Department that it was mindful of denying Revolut’s request, though they said no final decision had been made.
The Daily Telegraph was the first to report on the development.
Failure to obtain a license from local regulators for Revolut will be an obstacle to the group’s ambitions to expand its operations in other countries. It would also be a blow to the broader fintech sector in Britain and to Rishi Sunak’s government, which has sought to shore up the technology sector.
Revolut, PRA and the Treasury Department all declined to comment.
Revolut became one of the largest financial technology companies in Europe when it was valued at $33 billion in July 2021, after it raised $800 million from investors including Softbank.
It was founded in 2015 by Nick Storonsky, its CEO, and Vlad Yatsenko as a cross-border money transfer platform but is now a sprawling company, with operations including cryptocurrency trading and pet insurance.
The company has more than 28 million customers globally, including six million in the UK, and has more than 6,000 employees.
It emerged this month that Revolut’s chief financial officer and head of UK banking were leaving before the company’s long wait for a UK bank license ended.
In March, Revolut’s external auditors, BDO, raised concerns in its 2021 accounts about the “completeness and occurrence” of nearly £500m of sales and an “underdeveloped financial control environment”.
It hopes to submit new accounts for 2022 in the summer.