Revolut has blamed Brexit for forcing it to shift more than one million trading customers from London to Lithuania in order to market its products to European clients.<\/p>\n
The fintech company will transfer all European Economic Area (EEA) customers from Revolut Trading Ltd, its UK-based subsidiary, to its Lithuanian business by the end of this year, according to accounts filed at Companies House.<\/p>\n
The company did not disclose how many customers will be affected, but it is understood it will shift over one million accounts to its Lithuanian arm.<\/p>\n
The fintechs trading business, which allows customers to invest in shares and cryptocurrencies, has become a significant revenue stream for the company in recent years.<\/p>\n
In the accounts, Revolut said: Due to legislation introduced after the United Kingdoms departure from the European Union, the company cannot currently offer marketing of its products to its EU based customers.<\/p>\n
As a result, the business plans to migrate these customers to Revoluts European licenced trading entity towards the end of 2022.<\/p>\n
The accounts also reveal that the City watchdog has yet to grant Revolut a so-called Mifid licence, highlighting the regulatory hurdles it is continuing to face in the UK. The company obtained this licence for its Lithuanian business last year.<\/p>\n
It comes as the $33bn (29.5bn) company is still awaiting a decision on its UK banking licence application, which it applied for in January 2021 and is regarded as a key milestone in its development.<\/p>\n
Nikolay Storonsky, the companys co-founder and chief executive, previously said that he hoped to secure the licence early in 2022.<\/p>\n
The former banker has hit out at the Financial Conduct Authority (FCA) over what he regards as its slow procedures for processing applications, saying it was slower compared to expectations.<\/p>\n
Revolut has suffered a turbulent few months, including a series of high profile resignations and faces questions around its auditing and a cyber attack that affected about 50,000 customers.<\/p>\n
The accounts show that Revolut Trading Ltd generated revenues of nearly 13m in 2021, an increase of nearly 70pc on the previous year. Pre-tax profits came in at 8.9m for the period.<\/p>\n
Last month, in a boost for the company, Revolut was given permanent approval from the FCA to run its cryptocurrency business in the UK, having previously been placed on a temporary register.<\/p>\n
Revolut can no longer market trading products to EU clients from the UK as British-based companies were stripped of their passporting rights following the UKs exit from the EU, which gave companies full access to European markets.<\/p>\n
The Mifid 2 rulebook was introduced by the EU in 2018 in a bid to reduce conflicts of interest in the financial services industry.<\/p>\n
A Revolut spokesman said: \"We plan to migrate all EEA-based users of our trading product from Revolut Trading Ltd to Revolut Securities UAB.<\/p>\n
This migration will enable us to grow our trading product further in the EEA. Revolut Securities UAB is our investment firm, and Mifid licensed by the Bank of Lithuania.\"<\/p>\n
The FCA declined to comment. m<\/p>\n
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Revolut blames Brexit as it shifts one million trading customers from London to Lithuania - The Telegraph<\/a><\/p>\n","protected":false},"excerpt":{"rendered":" Revolut has blamed Brexit for forcing it to shift more than one million trading customers from London to Lithuania in order to market its products to European clients. Continue reading