Revolut


Revolut Ltd is a British financial technology company headquartered in London, United Kingdom that offers banking services. It was founded in 2015 by Nikolay Storonsky and Vlad Yatsenko.

History

Revolut was founded on 1 July 2015 by Nikolay Storonsky and Vlad Yatsenko. The company was originally based in Level39, a financial technology incubator in Canary Wharf, London.
On 26 April 2018, Revolut announced that it had raised a further $250 million in a funding round led by Hong Kong-based DST Global, reaching a total valuation of $1.8 billion and thus becoming a unicorn. DST Global was founded by Yuri Milner, who has been backed by the Kremlin in his previous investments.
In December 2018, Revolut secured a specialised bank licence from European Central Bank, facilitated by the Bank of Lithuania, authorising it to accept deposits and offer consumer credits, but not to provide investment services. At the same time, an Electronic Money Institution licence was also issued by the Bank of Lithuania.
In March 2019, the company's chief financial officer Peter Higgins resigned. TechCrunch reported that he had quit following allegations of compliance lapses, however Revolut denied that he had left for these reasons.
In July 2019, Revolut launched commission-free stock trading in New York Stock Exchange and NASDAQ, initially for customers in its Metal plan. This was subsequently made available to all users.
In August 2019, the company announced several hires with experience in traditional banking, including Wolfgang Bardorf, formerly executive director at Goldman Sachs and the global head of liquidity models and methodologies at Deutsche Bank, Philip Doyle, previously head of financial crime at ClearBank and fraud prevention manager at Visa, and Stefan Wille, previously senior vice-president of finance at N26 and corporate finance manager at Credit Suisse.
In October 2019, the company announced a global deal with Visa, following which it would expand into 24 new markets and hire around 3,500 additional staff.
In February 2020, Revolut completed a funding round that more than tripled its value, valuing the company at £4.2 billion and becoming the United Kingdom's most valuable financial technology startup.

Founder

Nikolay Storonsky is the founder and CEO of Revolut. He is a British-Russian entrepreneur. He studied for a master's degree in physics at Moscow Institute of Physics and Technology, and during this time became a state champion swimmer. He completed a separate masters in economics at New Economic School in Moscow. Prior to founding Revolut, Storonsky was a trader at Credit Suisse and Lehman Brothers. Alongside Vlad Yatsenko, former Credit Suisse and Deutsche Bank developer, Storonsky set up Revolut and raised around $3.5 million, saying in an interview with Forbes:
His father Nikolay Mironovich Storonsky is Deputy General Director of Science for Gazprom Promgaz since 2017, and First Deputy General Director for Science Gazprom Promgaz OAO.

Services

Revolut offers banking services including GBP and EUR bank accounts, debit cards, fee-free currency exchange, stock trading, cryptocurrency exchange and peer-to-peer payments. Revolut's mobile app supports spending and ATM withdrawals in 120 currencies and sending in 29 currencies directly from the app. It also provides customers access to cryptocurrencies such as Bitcoin, Ethereum, Litecoin, Bitcoin Cash, and XRP by exchanging with 25 fiat currencies.
If a payment is made at weekends, Revolut adds an extra 0.5% to 2% fees so as to protect against exchange rate fluctuations.

Controversies

Automated suspension of accounts

Revolut, in common with traditional financial institutions, uses algorithms to identify money laundering, fraud and other criminal activity, but unlike the rest of the banking industry, Revolut's algorithms additionally trigger the automated suspension of accounts. Revolut explains that "the system is programmed to temporarily lock an account and place it in a queue, until one of our compliance agents can review the case".
It is increasingly reported that Revolut's algorithms suspend a growing number of accounts in error for weeks or months at a time because Revolut does not have sufficient compliance agents to review the automated suspensions, and that while Revolut pays no interest on the large suspended balances, Revolut can earn interest on the funds in wholesale money markets. Customers whose accounts are suspended are blocked from contacting Revolut's usual support channel and instead receive automated responses from a chatbot. The Daily Telegraph reported that Revolut suspended an account containing £90,000 for more than two months and that another customer travelled 500 miles from Auvergne in France to Revolut's London offices in an unsuccessful attempt to recover £15,000 in an account that Revolut had similarly frozen without any justification being given. In a further case reported by The Times, Revolut suspended and subsequently closed a business account containing €300,000 belonging to Priorité Energie, which "helps low-income families in Paris to insulate their homes under a government initiative", preventing the company from paying its staff. Revolut's public internet forums contain an increasingly large number of complaints by customers about locked accounts and a lack of response from Revolut's support team, with many customers in each thread reporting a total loss of access to their money.

Employment practices

In March 2019, Wired published an exposé of the company's employment practices and work culture. This found evidence of unpaid work, high staff turnover and employees being ordered to work weekends to meet performance indicators. A later article in December 2019 by Sifted noted that Revolut had a higher rating than its peers on Glassdoor.
In June 2020, Wired published a further exposé of Revolut's dismissal of employees during the COVID-19 pandemic, in which employees, particularly in Kraków, were given the choice of being terminated for underperformance or a mutual agreement to leave the company voluntarily, in order to reduce the headline number of 62 redundancies announced by Revolut. The report explained that "Current and former Revolut employees say staff were coerced into accepting terminations, even though the company had no legal grounds to fire them" and that employees in Porto were pressured into agreeing to a salary sacrifice scheme in order to keep their jobs. According to Wired, in a message sent to the 495-strong customer support team on Slack shortly after the salary sacrifice scheme was announced, head of support Inna Grynova urged them to participate: