Revolut, a prominent payments giant, has been actively seeking a UK banking license for the past two years, with hopes of obtaining it in the near future, as expressed by its chief executives earlier this year.
According to the Telegraph, the Bank of England’s Prudential Regulation Authority (PRA) informed the Treasury in March about its intention to issue a statutory warning to Revolut, citing concerns regarding the company’s balance sheet.
After experiencing a six-month delay, Revolut finally submitted its accounts in March. However, auditor BDO raised concerns about the inability to verify £477 million of revenue and the lack of assurance regarding its completeness and occurrence, owing to Revolut’s internal IT system configuration.
Although the warning has not yet been issued, Revolut is engaged in urgent discussions to salvage the banking license, despite reportedly offering to withdraw its application at one point.
Nikolay Storonsky, CEO of Revolut, stated earlier this month that the license delay stemmed from regulators being cautious following the banking crises involving Silicon Valley Bank and Credit Suisse.
If Revolut’s banking license fails to gain approval, the company can still operate in the UK but will be unable to offer mortgages and loans, which are among its long-term objectives.
Revolut has faced various challenges recently. In addition to the license setback, its CFO Mikko Salovaara resigned earlier this month, citing personal reasons. Salovaara joined Revolut in January 2021, coinciding with the submission of the banking license application.
