Revolut Bank, like a lot of the challenger banks that stated up after 2011, isn’t yet a proper bank in the UK but an e-money institution. Yes it is regulated and licensed in the UK but it doesn’t yet (as at August 2021) have a banking licence. It does have a EU banking licence issued in Lithuania – which is actually a fairly common place for emerging or startup banks to get licensed.
Importantly this does make a difference, but not a huge one as it is still covered by a lot of UK based regulation. The big regulation it is not covered by is the Financial services compensation scheme or the £85,000 deposit guarantee. Revolut is actually termed a ‘neo bank’. There are several neo banks or challenger banks, banks that are e-money issuers and not part of the FSCS guarantee.
Revolut was only formed in 2015 but the 6 years old business actually has a bigger stock market value at £5.5bn than NatWest Bank – so to the stock market Revolut is doing very well indeed. As a banking business it is growing very fast and looking to be innovative in what it does. Reportedly it has over 15million customers, around 3½m in the UK and the rest spread across the EU – and is adding to its customer base at an impressive 440,000 per month! It has been the fastest growing bank across Europe for the last couple of years. So it must be doing something right!
Revolut has a business banking as well as a personal banking offering. Their business banking caters for commercial businesses but not charities or community groups. Their innovative service includes:
Very quick and all online account opening – all done via your mobile phone
Prepaid debit card
Foreign exchange services
Its latest innovation, called payday, is to be able to get what is effectively salary advance or payday loans for £1.50! You actually get charged £1.50 each time you take a drawdown against your salary which is amazingly cheap! Not only do you have to have a Revolut bank account, but your employer has to register onto Revolut’s scheme to get this set up.
On the negative side, there are no branches and the main way to communicate is via the in-app chat. A positive of the in-app chat is you normally get answered quickly. The only phone number is one to cancel lost or stolen cards.
If you like cash and cheques or visiting a branch then this is not the bank for you. If you like a slick mobile app and convenience then its a good bank to use.
So are they a good bank? Yes, but. The but is that they don’t have a full banking license and so they are not covered by the deposit guarantee scheme. This apart, yes, it does appear to be a good bank with a lot of ease of use and flexibility.