Insights from the Revolut CEO on Licensing Fumbles
Nik Storonsky suggested as much during a presentation to an investor audience in Helsinki, Finland. He observed that the U.S. market is more credit card-centric, which makes it more difficult to compete without this option. The report noted that Revolut operates in the United States with Lead Bank. In 2021, the company applied for a license that would enable it to offer banking services, including loans.
However, Storonsky stated that the organization is not in a rush to expand into new markets, as it was previously. He also stated that Revolut’s initial “grow fast” philosophy was inadequately considered. Revolut received a British banking license in July, following a three-year delay. Revolut encountered scrutiny regarding its size and financial reporting, resulting in a longer process than anticipated.
This week, the company disclosed that it boasts 50 million global customers, 20% of whom reside in its home country, and recently secured a $45 billion valuation through a secondary share sale.Storonsky intends for the organization to double in size, to generate $100 billion in annual revenue and attract 100 million daily active consumers in 100 countries. Revolut also disclosed this week that it intends to provide its 650,000 British consumers with novel trading products and features after obtaining a trading license from the Financial Conduct Authority (FCA).
Last week, Revolut announced the expansion of its cryptocurrency exchange. Revolut X, designed for professional crypto traders, is now accessible in 30 additional European Economic Area (EEA) countries.
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Industry Comments
“In the U.S., you need to be credit-driven. So in the U.S., we need to have a banking license to launch a product,” said Storonsky. “For a long time, I wanted to be as less regulated as possible, it was the completely wrong decision,” he said, adding that a smaller company would have been able to get licenses more easily than one the size of Revolut in 2024.
“The feedback from experienced traders has been very positive, with many already taking advantage of our near-zero fees, wide range of available assets and seamless integration with their Revolut accounts,” Leonid Bashlykov, head of product at Revolut, said in a news release. “Safety and accessibility are at the heart of our standalone exchange because we recognize that crypto traders value these features above all else.”
FAQ’s
1. What did Nik Storonsky say about Revolut’s U.S. banking license challenges?
Storonsky noted that the U.S. credit card-focused market and Revolut’s early aversion to regulation made it harder to compete and secure a license. The 2021 application is still pending.
2. Why did Storonsky criticize Revolut’s initial “grow fast” strategy?
He admitted the rapid expansion was poorly planned, leading to delays like the three-year wait for a British banking license due to regulatory scrutiny.
3. What are Revolut’s future goals despite past challenges?
Revolut aims to double its scale, achieve $100 billion in annual revenue, and reach 100 million daily users while expanding trading and crypto services globally.
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Conclusion
Revolut’s CEO, Nik Storonsky, reflects on the company’s evolving strategy, acknowledging past licensing challenges and the need for careful regulatory navigation. Despite setbacks, Revolut remains focused on ambitious growth, aiming for significant global expansion and continued innovation in fintech and cryptocurrency services.
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