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Revolut has been awarded a full banking licence by French authorities, accelerating Europe’s biggest fintech’s push on the continent.
The London-headquartered company on Monday said the authorisation had been obtained after an assessment by the French banking regulator, the ACPR, and the European Central Bank.
The permit is a key step in Revolut’s expansion plans, which are being closely monitored by European watchdogs who last year restricted its ability to launch new products. Over the past year, the fintech has pledged to invest €1bn, hire roughly 600 people in western Europe and open its European headquarters in Paris.
French regulators had previously pushed for the group to secure a licence to allow better oversight and supervision of its operations, which are among Revolut’s largest in Europe with 7mn customers.
The new licence will allow Revolut to provide a greater array of loans, mortgages and savings products to French customers.
Revolut in 2018 secured a European banking licence from Lithuanian authorities, which jointly regulate its European operations alongside the ECB.
However, the fintech has clashed with European authorities over its risk and compliance controls. The FT reported that the ECB hit Revolut with certain growth restrictions around how it could release products, saying that the company’s processes had “deficiencies”, such as launching too quickly and without proper risk controls.
“France has become a leading financial hub, supported by a dynamic financial ecosystem and a robust regulatory framework,” said Revolut founder and chief executive Nik Storonsky. “It is the ideal platform to accelerate Revolut’s next phase of growth — bringing us one step closer to our ambition of becoming one of Europe’s largest and most trusted banks”.
Revolut initially attracted customers with its flexible checking and savings accounts as well as international money transfers, then later expanded into cryptocurrency and stock trading. The company has said it has 75mn customers and aims to reach 100mn.
Unlike other fintechs, which have sought to nurture their domestic operations before attempting overseas expansion, Revolut has built sprawling global operations from the start and now operates in 40 countries with various licences.
Revolut was granted a full banking licence in the UK in March after a multiyear stand-off with regulators, who had at times expressed concerns around the company’s risk controls. Rachel Reeves, then UK chancellor, had previously tried to broker a meeting between Revolut and watchdogs only to be thwarted by Andrew Bailey, the Bank of England governor.
Regulators in Australia also awarded the group a full banking licence, following the UK authorisation. The FT previously reported that international regulators had been unwilling to grant their own licences because of hesitancy from the UK’s Prudential Regulation Authority.
Storonsky has said that Revolut will go public at the earliest in 2028. But the fintech is currently overseeing a secondary share sale which will value it at $115bn. Revolut has preferred to stay private for longer by engineering a series of share buybacks and drafting up generous incentive packages for Storonsky that will hand him greater control of the company.
Last week, the FT reported that the latest of these packages would be granted if the group grew its valuation to $500bn.
Revolut’s pre-tax profits last year rose 57 per cent to £1.7bn on £4.5bn of revenue.
