European Banking Licence 🏦


Make that two please.


1 year. German Bank License

#171, in an unlinkable article, said they are getting the licence in Lithuania next month but they need several months to do the passporting, and that they applied for an e-money licence in Luxembourg.

edit: the following article reports on what reported


The article seems to be a bit unclear and many of the comments below it (77 so far!) are from people who are confused also (possibly the article was altered after initial publication).

It concerns the application for an e-money licence in Luxembourg, rather than the banking licence in Lithuania. The article author does not clarify the current status of the banking licence application in Lithuania but I suspect that the reason for requesting the e-money licence in LUX is to expedite the process of covering its a$$ if the brexshit hits the fan - an e-money licence is much more straightforward.

So essentially it’s a low-cost hedge against a hard brexit or no-deal brexit - one that means there will be no transition period in place, so that they wouldn’t have the extra year or so to get passporting services set up for EU-wide operation.

If you read this and also read an earlier article from November 2017 (when they applied for the banking licence in Lithuania) then you will see that Storonsky has basically given up on acquiring a banking licence in the UK. So if it’s a hard brexit then UK users will probably never get the services associated with this (deposits earning interest, FSCS protection).

Storonsky seems to be quite pessimistic about what’s going on in London - though you can hardly blame him for that given how recent EU discussions have gone! He seems to want to follow Monzo’s business model in becoming an app-based bank - possibly not just a narrow bank but with credit facilities also. Monzo is essentially planning to turn itself into a financial portal that uses its client base to sell third party services to its customers and earn commission in the process. Their other revenue would be from interest arbitrage, i.e. the difference between what the BoE pays them for lodging their deposits with the central bank and what the current account holders receive.


Storonsky dismissed the “market place” model recently, pointing out that their strategy differs here from their competitors.


Well he also seems like the kind of guy who can change his mind when the facts change, although I never actually said he planned to copy Monzo’s financial portal idea, merely the app-based banking part.


They just want to sell thier own services like amazon or at least be like amazon :smile: :


2107 results: income 12.8 million GBP / loss 14.8 million GBP. Do you really believe with such financial results banking licence could be granted?


That is what I was referring to as “market place”.


Probably yeah , on a german news side Vlad Yatsenko (CO-Founder & CTO) said they will reach the break even point at the end of this year


If you read the article posted by Kastello you will see that when Storonsky criticises “marketplace banking” he is not talking about what the FT article described as “app-based banking” but specifically the Moneysupermarket type services that Monzo is also looking at. There’s little point in having an app and applying for a banking licence if you’re not going to consider app-based banking.

I never said that Revolut was seeking to emulate the Moneysupermarket side - only the banking part (narrow or otherwise) and I think he’s right to disavow it currently. Let Monzo try it first and he can see how that pans out for them. That’s just thin gruel to the real meat of getting customers to start transferring their salaries to app-based accounts (obviously those w/ actual banking licences), which is what Tom Blomfield et al are salivating over.


In the FT article, Storonsky says that they started to break even on an operating basis earlier this year!


through google doesn’t seem to put a pay curtain.

This part is on-topic:

Mr Storonsky, who created the company in 2015 after working for Lehman Brothers and Credit Suisse, said he expected Lithuania to grant its banking licence next month. But he added that it could still be many months before the company secured the necessary authorisations in each EU country to “passport” from Lithuania across the rest of the bloc.


What does app based even mean. It’s just a UX description, not related to core product design.


Well at least they reach it at some point this year :smile:


WTF why CTO is talking about financial stuff? If I remember correctly they already broke even in February or March… It is never ending BS.


Probably because he’s still also the CO - Founder :smile:


I was just lifting a phrase from an FT article (they also had it in quote marks IIRC). Don’t know why you are getting so bent out of shape about this one thing.


I honestly just don’t know what particular business model you’re describing with the term. Are you referring to mobile only as app based. Or is it that several offerings from different service suppliers are bundled in an app based UX? Does it refer to the way third party services get access to the core banking system, like Xero can be linked to the business account and then Xero runs like an app on the Revolut platform?

Revolut offers many services with third parties. But they do it differently than Monzo, Starling and N26. They try to control all the touch points with the customer. That seems to be the difference in strategy, they are not trying to build a financial hub or marketplace, they prefer to offer services under their own brand.


As with the option to buy stocks, I would hope to see it soon. Unfortunately and despite how much I love Revolut, they are not good at keeping their promise.