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Revolut’s “Karma” System Links Staff Behavior to Bonus Payouts
Financial technology firm Revolut is employing a “Karma” system to monitor employee conduct, assigning or deducting points that influence bonus distributions. This practice directly impacts Revolut bonus payouts and reflects the company’s efforts to strengthen its compliance framework.
Profits Surge Amidst Compliance Push
Detailed within Revolut’s recent annual financial summary, the system was revealed alongside news that profits more than doubled, experiencing a 148% surge to £1 billion in 2024. The upswing was primarily fueled by increased subscription uptake and revenue streams from both wealth management and cryptocurrency trading activities.
While the leading European fintech entity refrained from specifying an exact employee bonus allocation, it clarified ongoing efforts to cultivate a “robust risk and compliance culture.” This is being achieved via a “points-based system” which contributes towards payout determinations for its workforce.
How the Karma System Works
The Karma system is designed to evaluate adherence to risk and compliance mandates. According to Revolut’s annual report, this results in employees either accumulating or forfeiting points, which subsequently affect their bonuses. The Revolut Karma system serves this purpose:
- Tracking adherence to risk and compliance rules.
- Employees gain or lose points based on their actions.
- Points influence individual employee bonus amounts.
Team Performance and Individual Bonuses
Collected points are then compiled at the team level. The resultant collective score then adjusts individual employee bonuses either upward or downward. Revolut maintains that Karma functions as a mechanism to both reward and amend employee behaviors.
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Addressing Past Compliance Issues
This action by Revolut seeks to strengthen a previously strained reputation caused by previous deficiencies in compliance protocols and an allegedly problematic work environment. After its foundation in 2015, Revolut faced a series of accounting irregularities, breaches of European Union regulations, and concerns regarding an overly demanding work atmosphere. Those issues are believed to have postponed the approval of its UK banking license.
The fintech firm asserts that it has since rectified the past accounting and regulatory challenges, alongside actively working to improve its internal culture.
Revolut, originally established by former Lehman Brothers banker Nik Storonsky as a pre-paid card solution specializing in commission-free currency exchanges, has since expanded to encompass over 10,000 employees and serves customers across more than 36 countries, offering a spectrum of over 50 products and services. Its offerings include money transfers, residential rentals, buy now, pay later services, wage advances, e-sims, and cryptocurrency trading platforms.
UK Banking License and Future Prospects
After a three-year wait, Revolut secured a UK banking license, albeit with limitations, in July. Full approval from UK regulators is projected for later this year. Obtaining the UK banking license potentially clears the path for a significant stock market debut, with Revolut last valued at $45 billion. Government officials and financial executives are trying to persuade Storonsky to select London as Revolut’s primary listing location.
Earlier, the bank reported a 74% upswing in customer account subscription revenues last year, climbing to £423 million, triggered by the introduction of “enhanced benefits” across its subscription tiers. The perks included tickets to an exclusive London performance featuring pop artist Charli XCX, held just days before her sold-out UK arena tour in November.
Revenue generated across Revolut’s wealth management section showed a substantial 298% increase, stimulated by both gains in cryptocurrency trading activities and the launch of its proprietary crypto exchange platform.