Revolut finally publishes 2022 accounts but UK banking licence remains elusive

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The UK is at risk of becoming an “incubator economy” with tech firms moving abroad, if action is not taken to support companies to scale up, a group of Lords has warned.
The UK is at risk of becoming an “incubator economy” with tech firms moving abroad, if action is not taken to support companies to scale up, a group of Lords has warned.

Fintech giant Revolut has today filed its long-awaited accounts for 2022. The company reported a 45 per cent jump in revenue to £923m for the period as it onboarded 10m new customers.

Customer deposits rose 71 per cent and the number of customers paying a monthly fee to use its premium accounts jumped 55 per cent.

The London-based digital banking fintech, which missed a deadline to file accounts in September for a second year running, said it had generated a £6m net profit in the year to December 2022, its second straight year in the black (although this was mainly due to a tax credit. The fintech reported a loss before tax of £24.4m excluding the credit).

The firm said it was on track to generate more than £1.7bn in revenue this year and record a “double-digit net profit margin” after revenue growth accelerated to 20 per cent quarter-on-quarter and the gross profit margin hit 80 per cent in the fourth quarter.

The fintech company’s chief Nik Storonsky said Revolut recently surpassed the 35m customer mark and is aiming to “10x this, pushing towards 350m customers and beyond.”

He added: “Looking ahead, our focus is on continued growth across all our markets. We remain committed to our ongoing UK banking licence application in addition to bringing the Revolut app to new markets and customers around the world.”

The filed accounts may provide a boon to the firm in its elusive hunt for a banking licence.

Despite filing for full authorisation as a lender over two years ago, Revolut is yet to receive the green light from UK regulators. The fintech firm has been beset by troubles, including an exodus of compliance staff and a warning in its last full-year accounts that auditors could not independently verify some 75 per cent of its revenues.

This issue with the company’s accounts seems to have been resolved. In a note in the 2022 accounts, Revolut’s auditor BDO said: “[the] “matter [relating to the FY21 accounts qualification] has been resolved, and therefore we have been able to obtain sufficient appropriate audit evidence in respect of the relevant balances included in the financial statements as at and for the year ended 31 December 2022.”

Still, there has been no future mention of progress with the UK banking licence.

Then finance chief Mikko Salovaara told Morning Wire earlier this year that a licence was “imminent”, but authorisation from the Bank of England’s Prudential Regulation Authority has not been forthcoming.

Co-founder and chief executive Nikolay Storonsky told Morning Wire last June that the process had been slow due to regulators’ sluggishness and said they lagged behind their international counterparts.

Revolut last month called in former Deutsche Bank and Barclays executive Francesca Carlesi as chief executive for its UK business to spearhead its efforts to win.

Updated to clarify Revolut’s loss before tax and net profit position.