Revolut launches UK bank after PRA lifts licence restrictions, unlocking lending for 13M customers

What's the deal? Revolut has launched as a fully licensed bank in the UK after the Bank of England's Prudential Regulation Authority (PRA) lifted restrictions on its banking licence. The approval unlocks deposit protection under the Financial Services Compensation Scheme for its 13 million UK customers, and paves the way for lending products including loans and overdrafts.

The rollout will be gradual. New current accounts will open to a small group first, expanding over coming weeks, while existing customers will be migrated in phased batches over several months.

Why now? Revolut has been working toward this moment since July 2024, when it entered the PRA's mobilisation phase — a testing period that typically lasts up to 12 months but stretched longer due to the company's large customer base. The licence removes the last major regulatory barrier in its home market.

The timing also fits Revolut's broader expansion push. The company recently pledged to invest £3 billion and create 1,000 high-skilled jobs in the UK, and has announced a global £10 billion investment over five years as it targets 30 new markets by 2030. Last week it applied for a US banking licence.

What could go wrong? Migrating 13 million customers to a new banking entity is operationally complex. Any disruption to accounts or cards during the transition could damage trust at a critical moment — when Revolut is asking customers to rely on it as a fully fledged bank, not just a payments app.

Competition is also intensifying. Monzo and Starling are established UK digital banks with loyal customer bases, while traditional lenders are investing heavily in their own digital offerings. Winning customers on core banking products — rather than travel perks and currency exchange — requires a different kind of trust.

The signal: Europe's most valuable fintech, valued at $75 billion in a secondary sale last year, has finally secured the credential it needs to compete directly with Barclays and Lloyds in its home market. The UK licence, combined with an EU licence via Lithuania and a pending US application, brings Revolut's ambition of becoming the world's first truly global bank within reach.

For the broader fintech sector, Revolut's two-year mobilisation period is a reminder that regulatory approval — even for a company of this scale — moves slowly. The reward for patience is a full product suite that challengers without banking licences simply cannot match.

Sources:
WSJ
Revolut
Financial Times

Image credit:
Revolut

A.M.