‘Revolut’ Seeks License From Central Bank While Staying Global for Ukrainians

The fintech company and digital bank Revolut, headquartered in London, is in talks to receive a local banking license in Ukraine and expand its services to support Ukrainian refugees and freelancers, Head of Expansion Dmytro Strelchuk told Forbes Ukraine.

“Ukraine is a priority market for us,” Strelchuk said.

But is not the only one. Strelchuk added that the company is simultaneously launching its services in India, Brazil, and Mexico.

He said that Ukrainians have opened approximately 450,000 Revolut accounts with around 100,000 Ukrainian users using it monthly following its initial launch attempt. He added that it had taken about a year and cost Revolut between £2-3 million ($2.48-3.72 million) to launch its business in Ukraine.

“It was necessary to coordinate technical aspects and integration with ‘Diia’ [Ukraine’s digital documents management application] conduct a risk assessment regarding potential financial crimes, fraud, and so on,” he said.

The launch also involved negotiations with the National Bank of Ukraine (NBU), Ukraine’s central bank. The company’s team met with a relevant NBU deputy governor, Oleksii Shaban, in 2021, Strelchuk said.

“We don’t have a final date for when we’ll obtain the license, but I believe the discussion with the National Bank will be productive,” he said.

Dealing with FX restrictions imposed after Russia’s full-scale invasion

At the end of 2021, the startup registered an office in Ukraine, and in March 2022, it enabled Ukrainians abroad to access their funds by linking the app to Ukrainian bank accounts, as Kyiv Post previously reported.

Now, Revolut is available for more users who can make international transfers without fees and issues virtual cards, Forbes said.

However, Kyiv Post tried to put two dozen dollars into a Revolut account from a Ukrainian bank card and failed to do so. The bank stopped the transaction, stating it is impossible due to FX restrictions imposed by NBU.

The bank’s support channel wrote: “You have been denied a transaction from your hryvnia card on a foreign service. Currently, the following transactions are restricted for hryvnia cards: International transfers on Wise, TransferGo, PayPal, Skrill, and Revolut.”

In seeking a local Ukrainian license Revolut will have to abide by the same FX restrictions imposed as an emergency measure to prevent massive capital outflows following Russia’s 2022 invasion.

According to Strelchuk local Ukrainian banks are currently to blame for not sending money to a Revolut card.

“Revolut doesn’t have the limits that exist in Ukraine since it operates as a European bank account. Any transaction limits are applied by Ukrainian banks. From our end, we do not set any limits on transfers to or from Ukraine or any other countries,” he said.

Strelchuk said, however, that Revolut will comply with the rules and regulations in Ukraine and thinks the FX restrictions may “become more flexible” over time.

“Having a banking license allows us to offer a wider range of products, such as loans and merchant acquiring services for businesses,” he said.

Revolut to add investing and payments processing for Ukrainians

Follwoing beta-testing of its services in Ukraine, Revolut enabled customers to open a European bank account, access the Single Euro Payments Area (SEPA), make SWIFT transactions, obtain a card for children, and physical cards – in an exclusive yellow and blue design, the colors of the Ukrainian flag.

The company also provides an option to invest in cryptocurrency, with around 220 tokens available through its app, as well as the ability to buy and sell precious metals Forbes reported.

For clients, access to SEPA means that those working for foreign companies can receive payments in foreign currency, Strelchuk said.

He said that Revolut aims to stand out in a competitive banking market by positioning itself as a global bank for Ukraine.

Its key competitor is Monobank, a neobank with 8 million clients, founded by former senior managers of Ukraine’s largest bank, Privatbank, and operating under Serhiy Tigipko’s TAS Group with a Universal Bank license.

“But overall, these are two different products. Monobank is a product for Ukraine, while Revolut is a product for Europe. We provide access to a European bank account,” Strelchuk said.

Revolut targets two audience segments in Ukraine: people connected to Europe or the UK who need to transfer money from Europe to Ukraine or globally; and freelancers or anyone looking for a simple way to receive payments from abroad, Forbes Ukraine wrote.