Revolut Bank, part of the U.K. FinTech unicorn Revolut, has been granted a full banking license by the European Central Bank (ECB), the Bank of Lithuania (LB). The ECB-licensed and LB-regulated specialized bank can now issue consumer credit among other services, while protecting Revolut’s European customers under the deposit guarantee scheme. Revolut Bank had been operating in the European Economic Area (EEA) with a specialized European Union (EU) banking license it obtained through LB in December 2018. The FinTech then began rolling out banking services in May 2020, offering limited services like accepting deposits and offering credit services in Poland and Lithuania, its European base. The Bank has since expanded operations to more than 15 European countries, launching banking services in 10 European countries earlier in March and more recently in France, Italy, and Portugal. In Portugal, however, the firm’s launch has been met with criticisms from local Portuguese banks accusing new FinTech operators like Revolut of being held to different standards than other banking institutions.
The Portugal launches also prompted the Bank of Portugal (BdP) to clarify that the bank’s guarantee of deposits, which it launched in Portugal, is not associated with the Portuguese Deposit Guarantee Fund. Despite its EU banking license, Revolut is not yet a full-fledged bank on its home turf of the United Kingdom, operating with an electronic money institution license instead. To change that status, the challenger bank applied for a U.K. banking license earlier this year, which is expected to be granted in 2022. Outside of Europe, the firm also applied for a banking license in the U.S. earlier this year. Revolut Payments carried out payment transactions worth €100 billion in recent years and makes up over 50% of the electronic money and payment institutions market in Lithuania. The U.K. FinTech has plans to consolidate the two branches, Revolut Bank and Revolut Payments, as part of expanding its banking services across Europe.