Revolut Faces UK License Hurdle as Regulatory Deadline Nears

Fintech giant Revolut struggles to meet regulatory requirements as UK banking license deadline approaches amid auditing concerns

Key Takeaways

• Revolut faces July 2025 deadline miss for completing its UK banking license mobilization phase, with insiders warning the $45 billion fintech may not meet the 12-month provisional period requirements.
• Largest UK banking authorization attempt involves migrating over 500,000 customers, creating unprecedented complexity for regulators as Revolut becomes the biggest entity to undergo this licensing process.
• Regulatory concerns persist from 2023 when auditors BDO couldn’t verify significant revenue portions and the PRA raised flags about governance weaknesses and board structure deficiencies.

Introduction

Revolut’s journey to secure a full U.K. banking license remains stalled a year after obtaining a restricted license from the Prudential Regulation Authority (PRA) in July 2024. The fintech giant navigates the “mobilization” phase, limiting it to holding only £50,000 in customer deposits while serving over 45 million global users.

Multiple sources close to the matter raise doubts about the company’s ability to meet the expected July 25, 2025 end date for its 12-month provisional period. The delay triggers renewed concerns about regulatory strategy, financial transparency, and internal governance at one of the world’s most valuable fintechs.

Key Developments

Revolut initiated its UK banking license application in early 2021, but the process has encountered significant obstacles. The mobilization phase began after preliminary PRA approval in 2024, designed as a transitional period before full authorization.

In 2023, UK regulators identified critical weaknesses in Revolut’s auditing practices and board structure. The company’s auditors BDO were unable to verify a significant portion of revenue, while governance concerns centered on founder-centric decision-making processes and questions about board independence.

A recent meeting between Revolut, the finance minister, and the PRA was cancelled, allegedly at the Bank of England Governor’s request. This development compounds existing regulatory tensions as the company approaches its crucial deadline.

Market Impact

The licensing delays affect Revolut’s operational capacity and customer protection standards. Without full authorization, customer deposits remain uninsured by the Financial Services Compensation Scheme, creating competitive disadvantages against traditional banks.

Revolut’s valuation reached $45 billion, demonstrating continued investor confidence despite regulatory hurdles. However, prolonged delays could impact future funding rounds and market expansion plans, particularly as the company seeks to establish itself as a comprehensive financial services provider.

The company operates across over 30 countries with varying regulatory frameworks, but the UK license represents a critical milestone for its European strategy and credibility with global regulators.

Strategic Insights

Revolut’s scale creates unique regulatory challenges that smaller fintechs avoid. With over 500,000 UK customers at application time, the company represents the largest entity to undergo this authorization path, requiring unprecedented systems migration and compliance infrastructure.

The regulatory struggle reflects broader fintech industry tensions between rapid innovation and traditional banking oversight. Post-2008 financial crisis caution influences regulatory approaches, particularly for companies seeking comprehensive banking services beyond simple payment processing.

Domestic licensing difficulties drive Revolut’s international focus. The company named Paris as its new Western European headquarters in May, citing regulatory clarity as a key factor while maintaining London as a global operational base.

Expert Opinions and Data

Martin Gilbert, Revolut’s chair, anticipates “formally starting” operations as a UK bank “during 2025,” suggesting a timeline beyond the current July milestone. A company spokesperson emphasizes prioritizing regulatory compliance over “rushing to meet a specific date.”

Barney Hussey-Yeo from Cleo suggests the U.K.’s regulatory stance contributes to delays, noting Revolut’s operation across rigorous international jurisdictions. Simon Taylor from Sardine AI highlights inherent regulatory caution affecting progress due to Revolut’s operational size and complexity.

CEO Nik Storonsky previously criticized Britain’s regulatory environment while praising France’s digital banking framework. According to CNBC, he dismissed the idea of a London listing as “not rational,” reflecting broader strategic concerns about the UK market.

The PRA’s guidance states mobilization “should not take longer than 12 months” with extensions not routinely granted. Failure to complete requirements could result in authorization removal or cancellation.

Conclusion

Revolut’s licensing challenges exemplify the collision between fintech innovation and traditional regulatory frameworks. The company’s global scale and diverse product offerings create unprecedented complexity for UK regulators accustomed to smaller, more focused banking applications.

The outcome affects not only Revolut’s UK operations but also sets precedents for how regulators handle large-scale fintech banking applications. Success would reinforce the UK’s position as a fintech innovation hub, while continued delays may accelerate the company’s pivot toward more accommodating European markets.