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Revolut, a digital challenger, is attempting to become an official bank, applying for a licence from the European regulator.
The fintech startup which started out by concentrating on money transfers with the use of a pre-paid card for spending overseas, but has since developed into more services, is currently set to go all-in and attempt to become a bank in its own right.
Previously, it has operated with an e-money licence which lets it offer bank-like services to clients. However, a full European banking licence will allow it to offer deposit and credit services.
It hopes to receive approval in the first half of 2018 and is planning to offer personal loans, overdrafts, as well as term deposits, with customer cash coming under the European Deposit Protection scheme.
The fintech startup was able to raise $66m over the summer from top investors and an additional $5m from private investors through crowdfunding. Revolut said that it made more sense to apply for a Europe licence, rather than a United Kingdom one so it can take advantage of passporting and a faster process of gaining approval.
Peer-to-peer lender Zopa, another high profile fintech firm, is also attempting to apply for a banking licence in a year where competition among various startups firing up.
Revolut has also revealed plans to move its own payments processing in-house, following in the footsteps of Monzo, its fellow challenger bank, so that it can have more control over its services.
A series of outages have struck various fintech firms during the past months, including Monzo and Revolut, with a third-party supplier to blame.