Revolut shifts regulation of Irish customers to Lithuania
Fintech says move is temporary and due to Brexit while it awaits Irish e-money licence
Revolut has one million Irish customers
Digital bank Revolut is to temporarily move regulation of its one million Irish customers to Lithuania from Britain due to Brexit.
The fintech currently operates in the Republic under a UK e-money licence, which allows it to passport its services elsewhere in the European Union. However, it said it is being forced to migrate regulation outside Britain to ensure it can continue to serve customers.
Britain will give up its so-called “passporting rights” as of December 31st with the UK regulator no longer able to oversee the accounts of EU citizens.
The company said most customers should not experience any noticeable difference although it added that those with direct debits and other recurring payments will have to contact companies to inform them of the change of IBAN (International Bank Account Number).
Revolut said while its terms and conditions will have to be updated to reflect this customer migration, they will remain “essentially unchanged” with users still having the full protections of EU law.
The company earlier this year announced it was in the process of applying for an e-money licence from the Central Bank here as it confirmed plans to shift responsibility for its European payments from London to Dublin. It said on Thursday that this process is ongoing and that migration of accounts to Lithuania is being done on a temporary basis.
The move means that Revolut’s customers will be regulated by the Bank of Lithuania for the foreseeable future.
“Our plan remains that, once the business in Ireland is authorised by the Central Bank of Ireland, we will migrate our Irish Revolut customers to the Irish entity (where the regulator will be the Central Bank of Ireland) and, in due course, many of our other Western European customers,” it said in a statement.
“In the interim the day-to-day functionality of Revolut will remain exactly the same as it is. Customers’ money will continue to be held securely in ring-fenced accounts in top-tier international banks,” the company added.
Founded in July 2015 by Nikolay Storonsky, Revolut has raised $836 million in funding to date from notable venture capital firms that include TSG Consumer Partners, Index Ventures, Ribbit Capital, Balderton Capital, DST Global and Dublin-listed Draper Esprit.
The company, which obtained a full banking licence from the Bank of Lithuania last year, has a market valuation of $5.5 billion, according to PitchBook.
Revolut offers a range of banking options, including a current account and an easy-access savings account. It has also added features such as commission-free trading just last week it rolled out a new kid-friendly money management app and service locally to encourage financial literacy among children.
Based in London and employing some 2,000 people globally, Revolut has processed more than one billion transactions worth over $100 billion since it was founded.