Article 50 was triggered on 29 March 2017 marking the beginning of the UK’s two-year divorce proceedings from the EU. Important questions, however, remain about what it means for the financial sector. Revolut CEO Nikolay Storonsky tells Briony Richter about the bank’s global plans.

The shockwaves caused by the UK’s decision to leave the EU have reached all parts of the financial industry in the UK.

Questions remain about how attractive the UK will be as a talent pool for startups, and what sort of access will be available once the country leaves the single market.

Potentially, changes to regulation at European level could make it harder for fintechs based in London to compete with those headquartered in EU countries. However, Revolut has prepared itself strongly to cope with any outcome that Brexit could bring up.

Along with Vlad Yatsenko, Storonsky launched Revolut in 2015 as a banking alternative aiming to completely transforming how people manage money. Now, it is has close to 3 million users.

So, what does Brexit mean for Revolut? Asked whether there is any situation that would push Revolut out of London, Storonsky says: “London is, and will continue to be, Revolut’s home. It is one of the best places in the world to set up and run a fintech company as the regulator supports the industry and we’ve seen the UK become the world’s financial centre as a result. London is also a blossoming hub for European startups due in part to a very pro-entrepreneurship UK government.

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“Second to that, venture capitalists are not suddenly going to stop investing their money in British companies. It creates a little bit more paperwork, but ultimately we are expanding in London.”

He continues: “Passporting rights is the only thing that worried us, and now have covered that. We have an EMI licence by the FCA in the UK. If passporting is blocked, that could have caused issues, so what we did separately was apply for an EMI licence in Europe. Now, regardless of what happens, we are covered on both sides.”

Revolut is focused on expansion into international markets and expanding its customer base. The team works fast, and the company hires those it knows can lead and create. Projects at Revolut can take just a month to go from an idea to reality, and it is this sort of work strategy that has rewarded the business with rapid growth.

In many ways, challengers can adopt solutions quicker than incumbents to tackle the outcome of Brexit.

Storonsky adds: “We can move faster than banks, and we have far fewer layers of bureaucracy. That’s the way fintechs think.

“If we need to operate a second system in Europe we can do that pretty quickly because we built it all ourselves, whereas banks are plagued with legacy systems that hold them back, and spend millions on developments. A prime example is that we started Revolut with a few million, and RBS has just announced its new challenger bank, which it has already spent £50m building.”

Global expansion

Despite the uncertainty of Brexit, early stages of negotiation have had a minimal impact on fintechs.

Speaking to Storonsky, it does not seem to be a massive hurdle – other than slightly more paperwork. Of course, that is a result of the fintech putting safeguards in place to shield it from any discomfort when Brexit comes our way.

Instead, Revolut has its eyes set firmly on global goals. The fintech has seen rapid growth ,and this is fuelling the team to expand further and – most importantly for Revolut – do it first, and do it best.

In January, Revolut is set to touch down in the US and Canada, and then on to Australia and New Zealand. The scalability is extremely fast, but Storonsky assures that the company is ready and is always gearing up for the next move.

“Our view is we are going to go global and be the app that you manage every aspect of your financial life on,” he notes.

“We are focusing on launching in the US, Canada, Hong Kong, Singapore, Japan, Australia and New Zealand so we can reach our target of signing up 100 million customers in the next five years.”

Asked whether there is demand for Revolut in other international markets, Storonsky takes the US example. “In the US we already have 100,000 on the waiting list,” he explains.

“The idea that there isn’t a demand for this is just nonsense. I’d say that America is even more anti-bank than Europe. There’s no kind of card in America that lets their customers spend abroad with no fees for free. It’s unheard of. In America there is nothing like us there.”

In short, Brexit need not be a worry for fintechs that have put preparations in place. Revolut is ready, and is looking ahead rather than sitting and waiting. In fact, progress has continued in the sector since the EU referendum. However, these are uncertain times, and only after the final deal will the true consequences be realised.