Revolut Seeks US Banking License to Expand Into American Market

British neobank Revolut is expanding into the fiercely competitive US banking market. Europe’s leading digital bank has officially applied for a national banking license in the United States. Revolut plans to offer banking services directly to the US market in the future, without intermediary partner institutions.

The US is considered difficult territory for European digital banks. For example, Revolut’s competitor N26 from Germany unsuccessfully attempted to gain a foothold in the US. The Berlin-based neobank abandoned its US ambitions in early 2022 after only two years because its expansion plans hadn’t proven profitable .

Regulatory Maze USA

The banking sector in the US is considered a regulatory labyrinth, especially compared to the European Union. In Europe, banks benefit from so-called “passporting”: those who hold a license in one EU country (like Revolut in Lithuania) can offer their services throughout the entire EU. The situation is different in the US. Here, fintechs must decide whether to pursue a national license – which is a lengthy and expensive process – or apply for licenses in each of the 50 states individually.

Without their own license, players like N26 rely on partner banks. However, these collaborations are often inflexible and vulnerable to regulatory issues, as the partner bank is liable for the fintech’s misconduct.

Revolut’s starting position is more favorable than it was for the Berliners back then: With a current valuation of 75 billion US dollars, the London-based fintech is one of the most valuable private technology companies worldwide and leaves competitors such as N26 behind in terms of market capitalization and global reach.

Global expansion planned by Revolut

Revolut announced last autumn that it would invest €11.5 billion in global expansion over the next five years, creating 10,000 new jobs worldwide. The British company stated its goal is to reach 100 million private customers by mid-2027.

Nik Storonsky, founder and CEO of Revolut, said: “The United States is a central pillar of our global growth strategy.” Submitting the Bank Charter Application is a significant step toward realizing the vision of building the world’s first truly global banking platform. “This license will give us the direct control we need to accelerate innovation and bring the Revolut experience to millions more Americans as we work toward our goal of 100 million customers.”

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