Revolut is reportedly facing further delays in securing a full UK banking licence because of regulators' concerns over the fintech's risk controls relating to cross-border payment. Separately, the firm has acquired an AI travel agent incubated at an innovation hub run by airline Lufthansa.
Revolut finally won approval for a UK banking licence last year, after a three-year wrangle with regulators. That approval triggered a 'mobilisation' stage during which time Revolut’s banking division can accept total deposits of just £50,000 while building out its controls and infrastructure.
At the time, it was thought that Revolut would be able to end the mobilisation period within 12 months, but that date came and went on 25 July, with no sign of further progress.
Now, according to the Financial Times, the Financial Conduct Authority and Prudential Regulation Authority have expressed concern over how the firm handles its cross-border payments.
Officials are seeking assurances that Revolut will boost its risk management controls as it pursues rapid international expansion. The company recently outlined a five-year global plan to invest £10 billion and create 10,000 jobs as it targets 100 million customers by mid 2027 and entry into 30 new markets by 2030.
The lengthy mobilisation phase has previously seen tension between Bank of England governor Andrew Bailey and Chancellor of the Exchequer Rachel Reeves. Reeves pushed for a three-way meeting between Treasury officials, the PRA and Revolut, to clear stumbling blocks towards the vendor exiting the mobilisation phase.
Citing 'people familiar with the matter', the FT reported that Reeves wanted to see Revolut win full regulatory clearance as soon as possible, but her efforts to force the issue were thwarted by Bailey, who intervened to cancel the planned meeting.
Separately, Revolut has Swifty, an AI-powered travel agent startup originally incubated at Lufthansa Innovation Hub (LIH). The deal brings Swifty's proprietary AI technology and co-founders Stanislav Bondarenko and Tomasz Przedmojski to Revolut, where they will focus on enhancing the company's loyalty and lifestyle products.
Christopher Guttridge, head, loyalty, Revolut, says: “This acquisition strengthens our position at the intersection of finance, AI and lifestyle. Through this move we’re gaining both talent and expertise in AI driven travel solutions, which will help us deliver even more personalised and seamless experiences to our customers.”