Banking licence, compliance, maximum funds, and CHF top-up account


#21

So each country in the EU have to set up a scheme that all banks in that country are part of. The minimum is 100.000euro.

DGSs set up and officially recognised in 1 EU country must cover the depositors at branches of their members in other EU countries.


#22

The answer of all your questions is SOON!


#23

Yeaaaaah, thats precisely what I ruled out at the beginning :wink:


#24

You now the Revolut Rules…

Revolut rules:
Soon: You have to wait Two and half years
Very soon: You have to wait one and half year
Very very soon: You have to wait one year


#25

And around the corner is five years?!


#26

The corner is actually a circle and you turn in a loop


#27

Dammit, I was afraid it was


#28

On a serious note though, @AndreasK?


#29

Well… So each EU country has absolutely separate deposit guarantee in place. Fine, but do you really believe such small country/ecomomy as Lithuania is capable of handling bank with +2 million customers? If Revolut folds down, Lithuania will be busted.

Probably you are too young to remember or was still in an infancy stage… Do you know something about Iceland financial crisis? https://en.wikipedia.org/wiki/2008–2011_Icelandic_financial_crisis


#30

CHF top up: patience is expensive when Lloyds charges 25 CHF for every incoming payment! For everyone in Switzerland / Liechtenstein, this is a no-go as it makes Revolut more expensive than a VISA Platinum from the house bank!

Some idea on how long it will take until Revolut makes CHF top up econmically viable would help us evaluate better if Revolut is the thing for us or not.


#31

Yes, in my infancy stage as a 20-23 year old…


#32

Not every country uses EUR so it is a bit far fetched to assume all 2million customers will be banking through it. When they roll out more local currencies they will have to create more partnerships with other banks.


#33

as far as I saw, I paid around 6.- for a 1’500.- chf transfer to R from Postfinance.

You can also just do a free SEPA transfer from Postfinance - but it has to be in EUR, so I guess some currency gets ‘lost’ in the conversion in PF. Does anyone know if this is a bad idea?


#34

Currency does not really matter, local laws do. At a current stage, Revolut already has ±2 million customer across EU/EEA and in case they get banking license in Lithuania, they will be cover according to Lithuanian laws. In case something goes south, Lithuanian taxpayers will have to pay. Are they really capable to do so? Very much doubt. Real GDP per capita: LT>12700€ vs EU28> 27600€ (Eurostat). Average monthly earnings (gross) in Lithuania >774€ https://www.eurofound.europa.eu/country/lithuania#pay

Check Icesave story to get better picture https://en.wikipedia.org/wiki/Icesave_dispute

Seems Revolut is also working on a banking license in UK, but, most likely, just UK based customers will be managed under UK laws.


#35

Though that would be under the assumption all of those two million customers are active accounts with about 100,000 euro in them. If that was the case, good night Lithuania, that bill would be 200 billion euro :slight_smile: but I guess many wont be active at all and out of the active ones most will have less than a thousand.

Anyhow, I appreciate a discussion about that topic but I’d appreciate even more a concrete response to these very concrete questions :slight_smile:


#36

Isn’t it the point that they become a bank and they can passport their license to other member states in the eu by establishing branches. Isn’t that the same that HBSC has done across the globe? By establishing branches in other countries, they must adhere to those rules and should be covered by that countries protection scheme.

With regards to the EU/EAA point. They are MANY countries in the EU that does not use Euro as their currency. My country Denmark is just one of them. For Revolut to give us local accounts then they must passport their license to Denmark and adhere to local laws and thus I will be covered by our proctection scheme.

Anyways, that is my thoughts and assumptions.


#37

When you have a banking license in a country, it does not mean that you also use this country for deposit. Maybe all the reserves will be in UK.


#38

Very much doubt you are right regarding branches… “Danske Bank A/S, Irish Branch (the “Bank”) is a participant in the Danish Guarantee Fund (Garantiformuen) the Danish deposit guarantee scheme. The Danish Guarantee Fund protects eligible depositors of the Bank against losses in the event that the Bank suspends payments or becomes subject to compulsory winding up. The Danish Guarantee fund also protects against losses if a financial institutions does not return investors’ securities - up to a certain amount. In respect of deposits, an eligible depositor is currently entitled to claim up to €100,000 (or its equivalent) under the Danish Guarantee Fund. In addition certain corporate customers may be eligible for compensation under the Danish Guarantee Fund.” https://www.danskebank.ie/en-ie/Personal/customer-service/Customer-information/Pages/deposit-protection.aspx

My bet HBSC has banking licence in any given country. The same applies e.g. to SEB or Swedbank in Lithuania. Regarding passporting… It has nothing to do with deposit insurance “A financial institution may then provide the services, or perform the activities, for which it has been authorised, throughout the Single Market, either through the establishment of a branch or the free provision of services.” https://www.eba.europa.eu/regulation-and-policy/passporting-and-supervision-of-branches

P.S. EU-wide deposit guarantee scheme is in limbo https://www.reuters.com/article/us-eu-banking-germany/euro-zone-without-breakthrough-on-deposit-guarantee-despite-ecb-call-idUSKCN1GO20Y