British fintech Revolut is seeking more than a $40 billion valuation in a planned $500 million sale of its existing shares, according to Financial Times and Reuters. Although there is no official confirmation yet, the new valuation is over 20 percent higher than its previous $33 billion valuation in 2021.

Cementing as Most Valued Fintech

If confirmed, a $40 billion tag would make Revolut the most valuable fintech startup. Compared with other fintech startups, publicly listed Wise stands closest to Revolut’s valuation with an $8.9 billion market capitalisation. Monzo and Starling, two other challenger banks and direct rivals of Revolut, have valuations of $4.6 billion and $3.2 billion, respectively.

Revolut and Wise operate as payment institutions in the UK, while Monzo and Starling hold banking licenses. Revolut is also seeking a UK banking license, but the wait for the company has become too long since its application in 2021.

Interestingly, if the new valuation is confirmed, Revolut will even outpace many banks, including Barclays, NatWest, and Deutsche Bank. It is close to Lloyds’ market capitalisation of about $44.6 billion.

Growth Is a Factor

Revolut was founded in 2015 as a challenger bank and makes money from payments, subscriptions, and customers trading stocks and cryptocurrencies. Recently, the fintech also broadened its offering by adding a range of trading instruments including contracts for differences and bonds with third-party integrations.

Headquartered in London, Revolut has over 40 million customers globally, a third of which are from the UK. Its competitors, Monzo and Starling, only operate in the UK and have less than 10 million customers each. In Europe, Revolut operates with a Lithuanian banking license and obtained a similar license in Mexico. It has also received a payments license in India.

However, the British fintech decided to terminate its “Lite” version of its services, which allowed customers in many emerging countries to access basic functionalities like sending and receiving funds.

Meanwhile, Revolut is expecting to report a revenue of $2 billion in 2023 with a double-digit net profit margin. In 2022, the company generated $1.1 billion in revenue, 45 percent higher than the previous year.