Revolut Considers Buying US Bank to Accelerate American Banking Licence Approval

Digital banking giant Revolut is reportedly exploring the purchase of a US bank as it seeks to accelerate its entry into the American market. This strategic move would allow the UK’s largest fintech to bypass the typically lengthy process of securing a banking charter from scratch. According to a Financial Times report, Revolut is considering acquiring a nationally chartered bank that already holds a license. Such an acquisition would enable Revolut to begin lending in the US more rapidly than if it pursued a banking charter independently, a process that can often take several years. The company is also reportedly weighing the option of applying for its own banking license rather than pursuing an acquisition. Revolut has not yet responded to requests for comment.

Trump-Era Policies Seen as Potential Boost to Revolut’s Licence Bid

With 60 million customers worldwide, Revolut has been actively seeking ways to expand its presence in the substantial US financial market. Obtaining an American banking license would grant the company access to a vast customer base and deposits, a significant advantage at a time when UK fintechs are experiencing slower growth domestically. The Financial Times noted that the deregulatory agenda enacted during the Trump administration has created a perception that the Office of the Comptroller of the Currency (OCC) might expedite the approval process for bank charters. Nevertheless, Revolut continues to evaluate the most efficient pathway for its US market entry.

Revolut Eyes Middle East and Latin America as It Seeks Scale Abroad

The fintech is reportedly in discussions for a $1 billion deal that would secure fresh capital and value the company at approximately $65 billion. A portion of this funding is intended to support its global expansion efforts. Revolut has previously considered similar acquisition strategies in other regions, including plans to acquire a bank in the Middle East. Last month, it completed the purchase of Argentine bank Cetelem from BNP Paribas as part of its international growth strategy. While Revolut holds banking licenses in Lithuania, enabling it to operate across the European Union, and in Mexico, it has yet to secure a full banking license in the UK. Its application was approved last year, but with restrictions that currently limit its lending activities.

US Banking Approval Could Pave Way for Digital Asset Services

Revolut's international ambitions extend beyond traditional banking services. The company, which offers crypto trading in the UK and the European Economic Area, recently resumed limited crypto operations in Hungary following a regulatory pause earlier in the summer due to new licensing requirements for crypto service providers. Revolut suspended its crypto services in the US in October 2023, citing regulatory uncertainty. Securing a US banking license could therefore lay the groundwork for broader product offerings in the American market, potentially including digital asset services. Industry observers believe that obtaining a US banking license would represent a significant milestone for Revolut, enhancing its ability to compete with domestic fintech rivals.

Frequently Asked Questions (FAQ)

Revolut's US Banking Strategy

Q: Why is Revolut looking to buy a US bank? A: Revolut is reportedly looking to buy a US bank to expedite the process of obtaining an American banking license, which is typically a lengthy procedure. Q: What are the benefits of acquiring a US bank for Revolut? A: Acquiring an existing US bank would allow Revolut to bypass the long application process for a new banking charter and enable them to start lending in the US market more quickly. Q: Is acquiring a US bank the only option Revolut is considering? A: No, Revolut is also reportedly considering applying for its own banking license directly. Q: How might Trump-era policies affect Revolut's US banking bid? A: Deregulatory policies from the Trump administration are perceived by some as potentially speeding up the bank charter approval process by the Office of the Comptroller of the Currency (OCC).

Revolut's Global Expansion

Q: In which other regions is Revolut looking to expand? A: Revolut is also considering similar acquisition strategies in the Middle East and has recently acquired a bank in Argentina. Q: What banking licenses does Revolut currently hold? A: Revolut holds banking licenses in Lithuania (allowing EU operation) and Mexico. Q: What are the current limitations on Revolut's UK banking license? A: While Revolut has a UK banking license, regulators imposed restrictions that limit its lending activity.

Digital Assets and US Market Entry

Q: Has Revolut offered crypto services in the US before? A: Yes, Revolut suspended its crypto services in the US in October 2023 due to regulatory uncertainty. Q: How could a US banking license impact Revolut's digital asset services? A: Securing a US banking license could enable Revolut to offer broader digital asset services in the US, contingent on regulatory approval. Q: What is the significance of a US banking license for Revolut? A: A US banking license is considered a significant milestone that would help Revolut compete more effectively with its American fintech counterparts.

Crypto Market AI's Take

Revolut's strategic consideration of acquiring a US bank highlights the increasing importance of regulatory clarity and market access in the global fintech landscape. As the digital asset space matures, companies are looking for more direct pathways to serve customers and offer integrated financial services. Our platform, AI Crypto Market, leverages advanced AI for market intelligence and automated trading, mirroring the forward-thinking approach of firms like Revolut. By understanding complex market dynamics and regulatory environments, our AI-powered crypto trading bots can provide users with sophisticated tools to navigate the volatile cryptocurrency markets. Companies aiming for global expansion, much like Revolut, benefit from robust infrastructure and a clear understanding of regional compliance, areas where our extensive compliance resources provide valuable insights.

Revolut Mulls Buying US Bank to Fast-Track American Licence