Revolut – The Key Points
Positives:
- Revolut is a successful, well funded and stable UK based business.
- Revolut is fully regulated by the Financial Conduct Authority (FCA) in the UK.
- Over 18 million customers were using Revolut as of early 2022, in over 28 countries worldwide.
Potential Concerns:
- Revolut do not, as of June 2022, have a UK banking license. That means that customer deposits are not covered up to £85,000 per customer by the Financial Services Compensation Scheme (FSCS).
- The founder of Revolut is a UK citizen, but is also Russian. Given the ongoing events with Russia & Ukraine, this may cause issues, and some believe that it is the reason for Revolut still waiting for a UK banking license.
- Revolut allow customers to hold and trade cryptocurrency, which is a risky form of investment, and users should be well aware of these risks before trading.
- Whilst Revolut have a huge customer base and have launched in many countries across the world, they still make large losses, likely due to their continued worldwide expansion.
What Is Revolut?
Revolut launched in the UK in 2015. The two founders had experience in the traditional banking world, and built Revolut to be part of the fintech revolution that has transformed the banking and financial services industry. The growth of the business has been rapid, and in early 2022, Revolut stated they had over 18 million customers.
Revolut’s intention is to become a financial ‘super-app’, offering a wide range of different services across the industry, from banking to investment and more. They continue to expand into multiple countries across the world.
Is Revolut Safe – The Details
Regulation:
Revolut have a UK company, and as such they are regulated by the Financial Conduct Authority (FCA). Whilst they do have a European banking license, they currently do not have a UK banking license. They did apply for a UK banking license in 2021, but as of June 2022, this has still not been granted. Currently they operate under an ‘E-money’ license in the UK, which allows them to offer their services.
Protection/Insurances:
As Revolut are not currently a licensed UK bank, customer deposits are not protected by the Financial Services Compensation Scheme (FSCS). Revolut are in the process of an application for a UK banking license, which will solve this issue. However, this process appears to be taking time, which may be due to the Russian connections of the founders of the business.
Investment Risks:
Revolut’s main offering is essentially a banking one. However, they appear to want to continue to broaden their product. Notably, Revolut have been offering customers the ability to hold and trade cryptocurrencies. This has been a very profitable side of the business for Revolut, and they look to want to move more into that space.
Customers should be aware that any investment is risky, and especially with assets such as cryptocurrency, which can be very volatile.
Company:
Revolut are potentially the biggest fintech company in the UK based on the number of customers and valuation.
Data Security:
Revolut only access the data you hold within your Revolut account. They state that this data is protected by bank level encryption and security.
Other:
Revolut is a digital bank. As such they do not have branches you can visit, and most of the customer services are carried out via chat within the app. This means that if there is an issue with your account, you may have to wait longer than with a traditional high street bank to contact the customer services and get the issue resolved.
In addition, as a digital based entity, certain processes, such as fraud prevention, are automated, which can result in accounts being frozen if an action occurs on the account that is seen as suspicious by Revolut.
Together, the two issues above, can potentially lead to accounts being frozen for a period of weeks or months. There are many complaints of this nature online, so users should be aware that this issue can occur.
Resources:
Check the below links for places you can find reviews, discussion and a more in-depth look at Revolut:
Trustpilot
https://www.reddit.com/r/Revolut/
https://www.trustpilot.com/review/www.revolut.com
Is Revolut Legit?
Revolut have gained a huge amount of customers in the last few years, and are seen by many as the most successful fintech start-up of recent times. Whilst there are no clear red flags, potential and existing customers should take note of certain things, such as their current lack of a UK banking license (and therefore lack of FSCS deposit protection), and their promotion of risky investments such as cryptocurrency.