Revolut, a leading fintech challenger has applied for a UK banking licence. Already the holder of a banking licence in the European Union, the firm now hopes to receive its licence in its home country.

The application will now be reviewed by the Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA).

If successful, Revolut will be able to expand the services it offers within the UK to full-service current accounts, including overdrafts as well as loans. The firm will also have the option to offer credit cards to the UK market.

A UK banking licence will also mean that UK customers will receive protection under the Financial Services Compensation Scheme (FSCS) – a scheme that protects up to £85,000 per person.

12m customers and counting

Along with the likes of Starling and Monzo, Revolut is one of the most recognisable of the current crop of so-called challenger brands in the UK banking market.

It is perhaps surprising to learn that the firm doesn’t yet hold a UK banking licence.

The company currently boasts more than 12m customers as well as 500k business users. It’s product is centred on an app that is offered in more than 35 countries and supports over 30 different currencies.

The banking application comes soon after the firm launched its first web-app, a move which expands its service outside of the original mobile app and onto the desktop – akin to traditional online banking.

Analysis – the move to establish a trusted brand

Whilst Revolut and its cohort of fintech startups have been celebrated for their capacity to challenge the established ‘way of doing things’ in banking, if there’s one worry that has stuck, it is that customers are fearful of putting all of their financial eggs in one fintech basket.

The application to be granted a UK banking licence comes as a surprise; not because they’ve applied, but because Revolut didn’t have one already.

To make the move in the UK to fully-fledged bank, Revolut will not only increase its offering in the market, but it will also gain the trust that comes from its new status.

Crucially, the FSCS is good protection for consumers. Better still, many consumers are aware of what the scheme is and how it protects them. This will be repetitional gold-dust for Revolut and represents a significant step on its journey to become a brand that lasts.