TLDR
- Revolut has decided to abandon its plan to acquire a U.S. bank and will now seek a standalone banking license.
- The company initially aimed to fast-track its U.S. expansion by acquiring a chartered U.S. bank.
- Revolut found that acquiring a bank would be more complicated and slower than expected.
- The company is now applying for a de novo banking license from the U.S. Office of the Comptroller of the Currency.
- Revolut believes the revamped OCC will process applications faster under the current administration.
Revolut, the U.K.-based fintech company, has changed its approach to entering the U.S. banking market. Instead of pursuing a merger with a U.S. bank, Revolut now plans to apply for a standalone banking license. This move comes as the company looks to expand its services across the U.S. following its rapid growth in other markets.
Revolut Scraps U.S. Bank Acquisition Strategy
Revolut initially sought to expedite its entry into the U.S. banking system by acquiring a chartered U.S. bank. The goal was to operate across all 50 states, benefiting from an already-established banking license. However, the company has since decided against this strategy, as it would have required maintaining physical branches, conflicting with Revolut’s digital-only business model.
According to the Financial Times, Revolut found that an acquisition would be slower and more complex than initially anticipated. The company’s decision was influenced by the regulatory and logistical challenges involved in such a deal, leading Revolut to reconsider its plans. As a result, the fintech firm is now focusing on obtaining a “de novo” banking license from the U.S. Office of the Comptroller of the Currency (OCC).
Instead of pursuing a bank merger, Revolut is now seeking a de novo banking license, which is granted to new banks. This approach allows the company to establish itself as an independent entity within the U.S. banking system. Revolut is hopeful that a revamped OCC, under the Trump administration, will help expedite the licensing process.
The company has emphasized that the U.S. market remains critical to its global strategy. Revolut confirmed it is exploring various routes to enter the U.S. financial landscape, including the de novo application. While no final decision has been made, Revolut’s pivot reflects its commitment to maintaining a fully digital platform in the U.S.
U.S. Regulatory Landscape and Revolut’s Future Plans
Revolut’s shift to applying for a de novo banking license comes as the U.S. regulatory environment becomes more accommodating to fintech firms. In recent months, regulators have granted banking charters to crypto companies, such as Circle Internet and Ripple. This trend suggests a growing openness toward innovative financial services.
As Revolut expands its services, it continues to deepen its involvement in the crypto space. The company recently partnered with Trust Wallet to offer instant cryptocurrency purchases within the European Union. It has also secured a MiCA license in Cyprus, allowing it to offer crypto services across the European Economic Area, further solidifying its commitment to innovation in financial services.
