Revolut to bid for fresh European licence as it reveals losses

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CEO and co-founder Nikolay Storonsky is confident in the UK's place as a fintech hub post-Brexit (Source: Getty)

  Fintech powerhouse Revolut has revealed its post-Brexit strategy amid the publication of its 2017 financial accounts, which put a heavy spotlight on the banking app’s operational losses.

Primarily, a spokesperson for the London startup confirmed to City A.M. it had applied for a second e-money licence in Luxembourg, in addition to its 2017 application for a full banking licence in Lithuania.

The fintech currently operates under an e-money licence in the UK, through which it passports its services to other European countries.

In its financial year ending in December 2017, operational costs weighed heavily on Revolut as it incurred £14.8m in total losses after tax at a 52 per cent increase from the previous year, largely attributed to costs associated with its card scheme, acquiring and user acquisition as the app saw its user numbers treble.

Read more: UK fintech tops the US on investment for the first half of 2018

This was despite the fintech’s revenues for 2017 rose to £12.8m from £2.4m in 2016, which co-founder and chief executive Nikolay Storonsky said was “in reality” the result of the launch of several revenue-generating products such as cryptocurrency trading and premium accounts.

Though the company announced it had broken even earlier in 2018, the spokesperson told City A.M. that this has been “up and down” month-on-month as the year continued.

While there are no immediate plans to apply for a full licence in the UK, the startup added it does not intend to move away from its London base unless it starts to see a visible impact from Brexit on its ability to secure top talent or attract investment.

Revolut now has almost 3m registered users, and intends to launch in the US by early 2019.

Tags: Brexit FinTech