economy
ECB moved to rein in Revolut’s ‘self-guided missiles’ in Europe
Europe’s most valuable fintech was ordered to address ‘deficiencies’ in oversight amid a rapid product rollout
TL;DR
- The European Central Bank (ECB) has imposed new capital requirements on Revolut's EU banking operations.
- Revolut has been ordered to improve its internal controls.
- The ECB's supervisory arm is concerned about Revolut's rapid expansion and risk management capabilities.
- The measures were applied to Revolut's Lithuanian-based European arm after it received a full banking license in late 2021.
- Regulators globally are increasing scrutiny of rapidly expanding fintech companies.
- Revolut, founded in 2015, offers services like currency exchange, stock trading, and crypto.
- Revolut has faced regulatory hurdles in the UK, where it has yet to secure a full banking license.
- The ECB's actions are likely to slow Revolut's expansion and increase operating costs in the EU.
- The digital bank's ability to meet these new requirements will be crucial for its future success in Europe.