Revolut has up to 12 months to exit the ‘mobilisation’ stage.
The fintech will continue to offer services as a payment institution while it is in the ‘mobilisation’ stage.
Revolut, the largest fintech by valuation, has received a banking licence in its home country, the United Kingdom. However, the licence is currently in the ‘mobilisation’ stage, also referred to as ‘Authorisation with Restrictions’.
The London-headquartered fintech pointed out that many new banks, including challenger banks like Monzo, Starling, Atom Bank, Zopa Bank, GB Bank, and Kroo, have gone through a similar ‘mobilisation’ stage.
An ‘Optional’ Route
According to the Bank of England’s ‘new bank authorisation process’ guide, the “mobilisation route is optional.”
“Mobilisation should not be seen as the stage to commence a firm’s bank-building strategies, processes, and systems, but rather a route which allows new banks extra time to finalise and deliver the development of their banks, i.e., IT infrastructure, governance, and risk management frameworks, with the benefit of being authorised,” the guide explained.
“As mobilisation is intended to complete the build-out of the bank, we do not expect firms to make material changes to their strategy or individuals during mobilisation.”
When in the mobilisation state, one of the major restrictions on the banking licence recipient is the £50,000 annual deposit limit by customers. Revolut will circumvent these restrictions by continuing to offer services to UK residents under the existing e-money institution licence authorised by the Financial Conduct Authority.
A 12-Month Deadline
The Bank of England, in its guide, further highlighted that the mobilisation stage must be ended within 12 months. Further, the PRA and FCA set a list of mobilisation conditions for new banking licence holders entering mobilisation state for this exit from the stage.
“A Variation of Permission application for banks to exit mobilisation shall be required to be made at least three months prior to the expiration of the 12-month mobilisation period to allow sufficient time for the regulatory assessment,” the guide added.
During the mobilisation period, the new banking licence holders also attempted to secure further investments. Although Revolut did not publicise any fundraising plans, it is considering a secondary share sale round for its employee shareholders, aiming at a valuation of $45 billion. The fintech’s CEO, Nik Storonsky, will also reportedly offload a significant chunk of his stake in the company.
New Products Are Coming for Revolut Customers
The UK is the largest market for Revolut, with 9 million customers compared to the global 45 million customers. It has been operating as a payment institution in the UK since its establishment in 2015. However, it operates as a bank with a licence from Lithuania in the European Union. It also obtained a banking license in Mexico earlier this year.
As a bank in the UK, Revolut can now offer lending products, which it could not as a payment institution. Further, when Revolut starts operating as a bank in the UK, each customer’s deposits will be protected up to £85,000 under the Financial Services Compensation Scheme (FSCS).
Meanwhile, Revolut has been focused on expanding services outside the UK as well. Recently, it partnered with CMC Markets to offer contracts for differences (CFDs) products to its customers. However, it has terminated services under the “Lite” brand in many emerging markets.
Revolut, the largest fintech by valuation, has received a banking licence in its home country, the United Kingdom. However, the licence is currently in the ‘mobilisation’ stage, also referred to as ‘Authorisation with Restrictions’.
The London-headquartered fintech pointed out that many new banks, including challenger banks like Monzo, Starling, Atom Bank, Zopa Bank, GB Bank, and Kroo, have gone through a similar ‘mobilisation’ stage.
An ‘Optional’ Route
According to the Bank of England’s ‘new bank authorisation process’ guide, the “mobilisation route is optional.”
“Mobilisation should not be seen as the stage to commence a firm’s bank-building strategies, processes, and systems, but rather a route which allows new banks extra time to finalise and deliver the development of their banks, i.e., IT infrastructure, governance, and risk management frameworks, with the benefit of being authorised,” the guide explained.
“As mobilisation is intended to complete the build-out of the bank, we do not expect firms to make material changes to their strategy or individuals during mobilisation.”
When in the mobilisation state, one of the major restrictions on the banking licence recipient is the £50,000 annual deposit limit by customers. Revolut will circumvent these restrictions by continuing to offer services to UK residents under the existing e-money institution licence authorised by the Financial Conduct Authority.
A 12-Month Deadline
The Bank of England, in its guide, further highlighted that the mobilisation stage must be ended within 12 months. Further, the PRA and FCA set a list of mobilisation conditions for new banking licence holders entering mobilisation state for this exit from the stage.
“A Variation of Permission application for banks to exit mobilisation shall be required to be made at least three months prior to the expiration of the 12-month mobilisation period to allow sufficient time for the regulatory assessment,” the guide added.
During the mobilisation period, the new banking licence holders also attempted to secure further investments. Although Revolut did not publicise any fundraising plans, it is considering a secondary share sale round for its employee shareholders, aiming at a valuation of $45 billion. The fintech’s CEO, Nik Storonsky, will also reportedly offload a significant chunk of his stake in the company.
New Products Are Coming for Revolut Customers
The UK is the largest market for Revolut, with 9 million customers compared to the global 45 million customers. It has been operating as a payment institution in the UK since its establishment in 2015. However, it operates as a bank with a licence from Lithuania in the European Union. It also obtained a banking license in Mexico earlier this year.
As a bank in the UK, Revolut can now offer lending products, which it could not as a payment institution. Further, when Revolut starts operating as a bank in the UK, each customer’s deposits will be protected up to £85,000 under the Financial Services Compensation Scheme (FSCS).
Meanwhile, Revolut has been focused on expanding services outside the UK as well. Recently, it partnered with CMC Markets to offer contracts for differences (CFDs) products to its customers. However, it has terminated services under the “Lite” brand in many emerging markets.
Arnab is an electronics engineer-turned-financial editor. He entered the industry covering the cryptocurrency market for Finance Magnates and later expanded his reach to forex as well. He is passionate about the changing regulatory landscape on financial markets and keenly follows the disruptions in the industry with new-age technologies.
Dutch Neobank Bunq to Boost Workforce by 70%, Defies Fintech Job Cuts
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Transformation in the APAC Trading Landscape and Beyond | FMPS:24
As the financial services industry experiences rapid and transformative changes, leading fintech experts and policymakers come together to discuss the present and future of retail trading and the evolving regulatory landscape. Join this insightful session for a forward-looking perspective on the trends, innovations, and trader needs that are shaping the future of offerings on a global scale.
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Eric Blewitt, CEO, Investment Trends
Rhys Bollen, Senior Executive Leader, Digital Assets, Australian Securities and Investments Commission (ASIC)
Michael Bogoevski, Head of Institutional Sales, CMC Connect
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As the financial services industry experiences rapid and transformative changes, leading fintech experts and policymakers come together to discuss the present and future of retail trading and the evolving regulatory landscape. Join this insightful session for a forward-looking perspective on the trends, innovations, and trader needs that are shaping the future of offerings on a global scale.
Speakers:
Eric Blewitt, CEO, Investment Trends
Rhys Bollen, Senior Executive Leader, Digital Assets, Australian Securities and Investments Commission (ASIC)
Michael Bogoevski, Head of Institutional Sales, CMC Connect
Karin Setchell, General Manager, Product & Investing Solutions, CommSec
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Executive Interviews with Joe Li & Simon Naish | ATFX | FMPS:24
Executive Interviews with Joe Li & Simon Naish | ATFX | FMPS:24
In this Finance Magnates Executive Interview, Joe Li, Chairman at ATFX and Simon Naish, Country Head of Australia at ATFX Connect, discuss ATFX’s strategic growth in the APAC region, particularly focusing on their institutional arm, ATFX Connect. They highlight the importance of Australia as a strategic hub, the challenges of operating in a highly competitive and regulated market, and their plans for regional expansion across APAC. The conversation touches on the integration of advanced technology and multi-asset offerings, the significance of optimal execution tools, and the importance of tailoring solutions to meet the sophisticated demands of institutional clients. They also emphasize their strong regulatory compliance and their commitment to enhancing client experience through innovative tools and infrastructure.
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In this Finance Magnates Executive Interview, Joe Li, Chairman at ATFX and Simon Naish, Country Head of Australia at ATFX Connect, discuss ATFX’s strategic growth in the APAC region, particularly focusing on their institutional arm, ATFX Connect. They highlight the importance of Australia as a strategic hub, the challenges of operating in a highly competitive and regulated market, and their plans for regional expansion across APAC. The conversation touches on the integration of advanced technology and multi-asset offerings, the significance of optimal execution tools, and the importance of tailoring solutions to meet the sophisticated demands of institutional clients. They also emphasize their strong regulatory compliance and their commitment to enhancing client experience through innovative tools and infrastructure.
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Ready to Scale? Regtech in Australia, A Global View | FMPS:24
Ready to Scale? Regtech in Australia, A Global View | FMPS:24
In the effort to elevate Australian fintech on the global stage, RegTech presents a unique and compelling case. Despite the increasing demand for robust compliance solutions, Australia's RegTech sector—ranked third-largest globally—remains underfunded. Join this insightful fireside chat to explore the future of Australia’s RegTech hub and its global potential.
Key discussion points include uncovering the hidden opportunities in RegTech that VCs are overlooking, the necessary steps for increased governmental support, the readiness of the local ecosystem to collaborate across global regulatory regimes, and lessons learned from other leading fintech hubs around the world.
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Dickie Currer, National Lead, Tech Australia Advocates
Deborah Young, CEO, The RegTech Association
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In the effort to elevate Australian fintech on the global stage, RegTech presents a unique and compelling case. Despite the increasing demand for robust compliance solutions, Australia's RegTech sector—ranked third-largest globally—remains underfunded. Join this insightful fireside chat to explore the future of Australia’s RegTech hub and its global potential.
Key discussion points include uncovering the hidden opportunities in RegTech that VCs are overlooking, the necessary steps for increased governmental support, the readiness of the local ecosystem to collaborate across global regulatory regimes, and lessons learned from other leading fintech hubs around the world.
Speakers:
Dickie Currer, National Lead, Tech Australia Advocates
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Resilience in Trading: From Third Class To World Class | FMPS:24
Resilience in Trading: From Third Class To World Class | FMPS:24
Join Mario Singh, Founder and Chairman of Fullerton Markets, as he shares his life story, highlighting the traits that were required starting without financial knowledge to become a financial and trading expert recognised by world-renowned media like CNBC & Bloomberg.
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Join Mario Singh, Founder and Chairman of Fullerton Markets, as he shares his life story, highlighting the traits that were required starting without financial knowledge to become a financial and trading expert recognised by world-renowned media like CNBC & Bloomberg.
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IBs and Brokers: The Good, The Bad, The Ugly | FMPS:24
IBs and Brokers: The Good, The Bad, The Ugly | FMPS:24
For most brokers, IBs and trading educators are invaluable partners, driving highly targeted traffic from key regions. However, without proper management, these relationships can quickly turn sour. In this session, gain an insider’s perspective on the types of licenses IBs need in APAC, the crucial details in IB agreements that both parties must scrutinize, common disputes between IBs and brokers and effective resolutions, and the pros and cons of transitioning from IB to broker.
Speakers:
Melody Gao, Senior Lawyer, Sophie Grace
James Perry-Keene, Head of Strategic Partnerships, Pepperstone
Christopher Balanzategui, CEO, N3tworx
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For most brokers, IBs and trading educators are invaluable partners, driving highly targeted traffic from key regions. However, without proper management, these relationships can quickly turn sour. In this session, gain an insider’s perspective on the types of licenses IBs need in APAC, the crucial details in IB agreements that both parties must scrutinize, common disputes between IBs and brokers and effective resolutions, and the pros and cons of transitioning from IB to broker.
Speakers:
Melody Gao, Senior Lawyer, Sophie Grace
James Perry-Keene, Head of Strategic Partnerships, Pepperstone
Christopher Balanzategui, CEO, N3tworx
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