(A DISRUPTIVE MODEL COULD CHALLENGE THE BANKS)
October 16, 2024
Hello everyone
The big banks are in control, and nothing could shift their dominance, right?
Well, it might be time for a re-think of that notion.
In banking, the most potent disruptive model is coming from a group called ‘Revolut’ and it has just moved a step closer to getting an Australian banking license.
It’s just got a banking license in the UK, which means an Australian license now looks like a sure thing.
In fact, it is already making some serious inroads in the local market; the company has signed up 720,000 customers already in Australia and has transaction volumes annualized at an estimated $1bn.
Overseas, there are approximately 45 million very happy customers who have left the old banking players behind.
Revolut’s big chief, 40-year-old Russian-born Nikolay Stornosky, says he aims for the group to become the “Amazon of banking”.
So, why is Revolut such a big deal?
It began as a card service competing with operators like Western Union and quickly built up an overseas network of customers who found it faster and cheaper than traditional banks.
Revolut’s headquarters are in London. Its big breakthrough came when it got an EU license. More recently, the Bank of England license confirmed its status as a fully-fledged financial juggernaut, and it can now do everything from mortgages to deposits.
According to Matt Baxby, Chief Executive of Australian Operations, Revolut in Australia is growing at 100% a year, and that’s with a very low profile.
One outstanding feature is the security feature. It offers a once-off card number for any payment.
We are all aware of some of the trepidations we have when traveling and handing over our card numbers. Once a fraudulent operation has your number, you are in big trouble. Revolut’s “disposable card” regenerates your number after each use: problem quickly solved.
Revolut is currently estimated to be worth about $45bn off the back of a recent share sell-down, making it about one-fifth the size of CBA.
QI CORNER
SOMETHING TO THINK ABOUT
Cheers
Jacquie
