Revolut's millions of customers turned its UK banking license into an almost five-year wait
Storonsky said regulators saw a startup with no customers as safe, and one with millions as a risk they could be blamed for.
David Senra · Competition, Intensity & Building a $115 Billion Global Bank | Nik Storonsky, RevolutNik Storonsky, the founder of Revolut, wanted to move fast. A banking license would take three or four years, he said, while an e-money license could be granted within a year.
He chose the faster license. Revolut started with e-money and payment licenses, lighter permissions that let the company move money without being a bank.
Revolut added millions of customers first, then applied for a British banking license. Storonsky said regulators viewed the large customer base as greater risk, and the British process took almost five years.
Storonsky said the company had seven or eight million customers in Britain when it applied, and that he thinks no company that large had applied for a banking license before in Britain.
In Storonsky's reasoning, a newcomer with no customers looks safe to a regulator because such a company might still have few customers in three, four, or five years.
By contrast, approving a firm serving five to 10 million customers raises the stakes, in his account. If something goes wrong, regulators face blame and questions about why the firm was not regulated sooner.
Storonsky put the founder logic simply: "as a founder you want to do things faster." Revolut took the lighter license first, grew large, and then sought the bank license, a wait that lasted almost five years in Britain.
Questions people ask
What is the difference between an e-money license and a banking license?
An e-money firm can hold customer money, issue cards, and process payments, but it generally cannot lend deposits as loans. In Britain, e-money balances also do not carry the same deposit insurance as bank deposits, which protects up to 85,000 pounds per person at a licensed bank.
Why would regulators be tougher on a bigger applicant?
A failure affects more households, businesses, and payment flows when millions of people are involved. Regulators also face greater political and press scrutiny, more complex reviews of systems and controls, and higher expectations for capital, safeguards, and customer protection.
Did Revolut eventually get the UK license?
Yes, after the long review it received a UK banking license with restrictions, the normal first stage before full operation. New banks often spend additional months building systems, hiring control staff, and meeting conditions before regulators remove the limits.