Delayed accounts could deal heavy blow to Revolut bank licence bid

Boasting more than 25million customers in over 200 countries and a valuation of £27billion, online bank Revolut has been the toast of the fintech scene in recent years. 

With celebrity promotions involving heavyweight boxer Anthony Joshua and YouTube stars Sidemen, it has grown quickly since its launch in 2015. 

But the City is on alert after the London-based financial ‘super app’ failed to file its latest annual accounts on time. 

Revolut became the UK’s most valuable privately-owned tech firm in a £650million funding round in 2021 – winning backing from top investor Masayoshi Son’s Softbank and New York’s Tiger Global. 

That put its valuation on a similar level to that of established banks such as Barclays and NatWest. 

Moscow-born founder Nikolay Storonsky, 38, was last year estimated to have a net worth of £5.2billion. 

High-profile names brought on board include City grandee Martin Gilbert, who is chairman, and ex-Labour Minister Kitty Ussher, who is chief economist at the Institute of Directors. 

Revolut started life as an app to cut the cost of sending money abroad. But, even then, Storonsky made clear he had far grander ambitions. 

Today, it offers payments services, crypto trading, savings accounts and stock trading services. In November, it announced plans to move into Brazil, India and New Zealand. 

But the prize still just out of Revolut’s grasp is a UK banking licence – two years after it applied for one through a process involving intense scrutiny. Its smaller peers, Starling and Monzo, acquired a licence in 18 months.  

At the moment, Revolut has a licence in Lithuania, opening access to the European Union. A UK licence would mean deposits are covered by Britain’s Financial Services Compensation Scheme, which protects sums up to £85,000. It would also assist its efforts to gain similar accreditations in other markets, such as the US. 

Last autumn, Storonsky said the application was ‘going very well’, adding, ‘We’re almost there’. 

The fact that auditors BDO have not signed off on its accounts is likely to be a source of frustration at what could be a critical juncture. 

Revolut last filed accounts – for the year ending 2020 – in June 2021. 

There have been hints that the greater scrutiny of audit firms is causing the hold-up rather than any major concern about Revolut. 

But as Gary Greenwood, banking analyst at Shore Capital, put it: ‘You have to be very concerned about the prospects of any company that fails to file accounts on time. It certainly won’t help their hopes of being granted a UK banking licence.’ 

BDO said it did not comment on specific audits, but added: ‘Delays can happen for a number of reasons and, as part of our public interest duty to provide an appropriate level of challenge to the companies we audit, we do not sign off accounts until we’re fully satisfied with the information and evidence provided.’ 

The accounts are expected to be filed by the end of January. Revolut said: ‘Our accounts are finalised and we expect to confirm the previously reported news we are profitable.’