Business model: what is it?


#1

Hi,

I don’t understand revolut’s business model. How does it make money? Can you explain it? Or even better: can anyone answer the quora question here: https://www.quora.com/unanswered/How-does-Revolut-make-money ?

Thanks!


#2

Hi,

Revolut makes smaller part of income on collecting Premium account fees, but a major part of income is actually in Revolut’s FAQ section, which seems to be the part peope do not tend to read.

Cheers!


#3

According to Revolut…

How does Revolut make money?

We earn a nominal fee paid to us by merchants every time you spend on your Revolut Card. Revolut was launched to offer a fair and transparent service. It has been designed to offer the best value and the best user experience.


#4

• Card issuance fee, especially for virtual cards
• Customers need to maintain a positive balance in their accounts, which is a perpetual interest-free loan to Revolut
Interchange fee on every non-ATM transaction: capped at 0.2% in the EU now but as much as 3% elsewhere
• 2% ATM withdrawal surcharge
• 1% Weekend surcharge, with transactions most likely peaking during the weekend
• Fees for “illiquid” currencies such as the AUD :slight_smile:
• Other fees coming up anytime soon
• Upselling and cross-selling (“membership”, insurance, the coming wealth management)

But the endgame has got to be monetizing your financial records and purchase history, which is currently the last frontier for data mining.


#5

With these profits it’s fair as any business has to make money. But imagine the big banks and what they charge and on the huge volumes they have, no wonder they make so much money with their extra unfair fees!!

Good luck to Revolut and the like, they deserve our support. Just a bit of extra customer service and everyone would be very happy.


#6

Going to quote my previous post. This ‘interest-free loan’ is misinformation.

Revolut is not a traditional (UK) retail bank, where they are allowed to use customer money and allocate that for business loans.

This is analogous of a trust law relationship, rather than a principal–agent relationship.


#7

@capital Fair point, I missed that part in the FAQ.


#8

…and here we go again with Revolut not being up to date and consistent - this FAQ section has not been updated, now the money is held at Lloyds. @Revolut, is it so difficult to have a person or two who would exclusively be in charge of keeping all info updated and transparent on all communication channels at all times??


#9

Thanks guys, that’s helpful.

Feel free to answer the Quora question too, it feels less hidden away than this topic:
https://www.quora.com/unanswered/How-does-Revolut-make-money