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Revolut’s application for a UK banking license may be rejected: Telegraph

Companies • May 19, 2023, 4:00AM EDT | Provided by Revolut

Quick Take

  • The Bank of England has told the Treasury it’s planning to reject Revolut’s application for a banking license, The Telegraph reported.
  • Revolut’s finances have drawn scrutiny after its auditor cast doubt on its 2021 revenue numbers.

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Revolut, the UK-based neobank that offers crypto trading as part of its financial app, may have its application for a banking license rejected by the Bank of England, according to a report in The Telegraph.

The BOE has told the UK Treasury that it’s planning to reject Revolut’s application, the newspaper reported, without saying where it got the information. A spokesperson for Revolut said the firm doesn’t comment on ongoing licensing applications. The BOE also declined to comment. 

Revolut’s finances have drawn scrutiny this year after its auditor, BDO, cast doubt on its 2021 revenue numbers. In a note accompanying the accounts, BDO said it had been unable to verify three-quarters of the revenue Revolut had reported — equal to $765 million — and warned that some information may be “materially misstated.”

While the neobank’s existing services would not be affected if the BOE refuses to grant Revolut a banking license, it would be unable to offer mortgages and loans to UK customers. 

Revolut’s crypto revenue

Since launching in 2015, Revolut has grown to become the UK’s most valuable fintech firm. Crypto trading accounted for about a third of Revolut’s revenue in 2021, though that has declined to less than 10% as interest in crypto waned during the bear market, according to a person familiar with Revolut’s finances. 

Revolut has in the past mooted launching its own native crypto token. This time last year, CEO Nik Storonsky told The Block that the token would function in a similar way to airline Air Miles programs to reward users. The token is yet to appear. 

Update: Story updated to show the Bank of England declined to comment.