Revolut's New Unit in France Will Launch With Restrictions — Bloomberg

The French branch of fintech company Revolut, which will become its second banking hub in Europe, will most likely begin operations with the same restrictions on launching new products that are already in place in Lithuania, sources told Bloomberg. According to the sources, Revolut is expected to receive its license in France in the coming weeks or months.

As sources told the agency, the ECB imposed a number of restrictions on Revolut’s European division last year due to shortcomings in the company’s control system and approval procedures. In particular, it was barred from launching certain new products, including mortgages. Revolut has a small portfolio of mortgage loans in Lithuania; however, as stated on the company’s website, it is not possible to apply for a loan—only joining the waiting list is available. The Financial Times previously reported on the tightening of regulations regarding fintech: according to its report, the regulator was not pleased with how quickly the startup approves new product releases.

The measures taken will almost certainly affect the French subsidiary as well, according to Bloomberg sources.

A Revolut spokesperson told Bloomberg that the company is in ongoing dialogue with regulators, including the ECB, as part of its efforts to obtain a full banking license, but declined to comment on any restrictions or the timeline for obtaining the license. He also said that Revolut’s Lithuanian unit has begun a formal corporate restructuring in connection with the company’s transition to a dual-hub operating model in Europe—with headquarters in Lithuania and France.

The ECB declined to comment to the news agency.

Revolut is currently Europe’s most valuable fintech company. Like other neobanks, it has grown thanks to affordable money transfers and payments and is now seeking to transform itself into a major banking institution. However, its growth rate is causing concern among regulators, Bloomberg notes.

In March, Revolut received a full banking license in the United Kingdom and is awaiting a decision on its application in the United States. In mid-June , the company entered the UAE market after receiving approval from the country’s central bank. On July 21, it was announced that the fintech company had obtained a full banking license in Australia. Next year, Revolut plans to open an office in Paris to drive its expansion in Western Europe. The startup currently has over 75 million users worldwide.

In mid-July, Revolut was among the 36 payment providers selected by the European Central Bank to participate in a pilot project to introduce the digital euro.

The fintech company is considering a secondary share offering in which the entire business could be valued at $115 billion, Bloomberg sources reported in June. According to Revolut founder Nick Storonsky, an IPO is not planned until at least 2028.

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