Revolut Applies for U.S. Bank Charter
Another FinTech app has announced that it’s looking to become a bank. As TechCrunch reports, London-based Revolut has filed a draft application with the California Department of Financial Protection and Innovation as well as the Federal Deposit Insurance Corporation (FDIC). If granted, the charter would allow Revolut to offer a greater number of financial services on its own. Currently, Revolut partners with Metropolitan Commercial Bank for its U.S. debit products as well as with Sutton Bank for its “Savings Vaults” feature.
On the surface, Revolut may seem like just another FinTech banking app. However, the platform does have some unique features. For one, the service allows users to purchase and hold foreign currencies alongside their U.S. dollars. Elsewhere, Revolut also offers perks such as airport lounge access and travel insurance as part of their optional paid subscription services.
In addition to filing for a charter here in the States, Revolut also recently announced it was applying for a banking license in its native United Kingdom. As for other parts of Europe, a specialized license from the Bank of Lithuania has allowed Revolut to operate as Revolut Bank (with some restrictions) in several countries. In fact, earlier this month, customers in Bulgaria, Croatia, Cyprus, Estonia, Greece, Latvia, Malta, Romania, Slovakia, and Slovenia became eligible to transition their accounts from Revolut to Revolut Bank.
Revolut is only the latest FinTech to pursue the bank charter route. Last month, Brex submitted its application with the FDIC and Utah Department of Financial Institutions while other firms such as SoFi and Square have also taken steps to become banks. Importantly, last year, Varo officially became the first FinTech to be approved for a national bank charter.
Speaking to why Revolut is looking to obtain a bank charter, Revolut co-founder and CEO, Nik Storonsky said, “A U.S. banking license would ultimately enable us to provide U.S. customers with all the essential financial products and services they can expect from their primary bank including loans and deposits.” He continued, “We’re on a mission to build the world’s first global financial superapp, and pursuing a U.S. banking license is an integral part of the journey.”
While it’s only been a few months since Varo completed the process of becoming Varo Bank, there are now several other FinTechs in the queue to add “Bank” to their monikers as well. As a result, the landscape for financial apps could change drastically in the years ahead. In the case of Revolut, the certification would be particularly notable given their previously established global reach. Overall, it seems like this trend is one that will only gain steam as the FinTech industry moves forward.