Revolut seeks NZ banking license to shake up financial services
British fintech giant Revolut, which entered the New Zealand market in July 2023, is seeking banking registration from the Reserve Bank (RBNZ).
Achieving this milestone would allow the company to expand its offerings, including interest-bearing savings accounts and a broader range of credit and debt products.
Since launching in New Zealand, Revolut reports having processed transactions worth approximately $350 million and introduced 18 financial products, interest.co.nz reported.
Innovation and competition for NZ banking
Revolut is already listed on the Ministry of Business, Innovation & Employment’s Financial Service Providers’ register and supervised for compliance with the Anti-Money Laundering and Countering the Financing of Terrorism Act.
Georgia Grange (pictured above), Revolut’s head of New Zealand, emphasised the company’s commitment to disrupting the traditional banking model.
“Underserved for decades, Kiwis have had to put up with a lack of innovation, core functionality and high fees,” Grange said. “Revolut is here to change that… Receiving a banking license will allow Revolut to become the first global digital bank in New Zealand and will drive much-needed competition across the industry.”
Among its offerings, Revolut provides cryptocurrency trading – an area yet to be explored by traditional NZ banks, interest.co.nz reported.
Fintechs eyeing banking licenses
Revolut isn’t the only player pursuing a banking license. Local fintechs Dosh and Debut are also seeking registration. This uptick in fintech interest follows the Commerce Commission's market study and a parliamentary inquiry into banking competition.
The government has pledged to implement all 14 of the commission’s recommendations, including reducing the minimum capital requirement for entities taking public deposits from $30m to between $5m and $10m.
Challenges ahead for Revolut
While Revolut has experienced rapid growth – now boasting more than 50 million customers worldwide – it faces scrutiny in other markets, interest.co.nz reported.
In the UK, it is addressing a lawsuit over fraud allegations and complaints about authorised push payment scams. The fintech has also drawn attention in Europe, where it faced parliamentary investigations in Lithuania and delays with financial reporting in Britain.
Despite these challenges, Revolut’s valuation remains strong, with recent private share sales valuing the company at US$45 billion.
If granted a banking license, Revolut’s entry as a digital-first bank could bring much-needed competition to New Zealand’s banking sector, interest.co.nz reported.
Read the interest.co.nz news here.
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