The Bank of England has directed a formal review of Revolut’s processes for approving new financial products, focusing on the risks associated with the rapid pace at which the fintech launches offerings. The Prudential Regulation Authority issued a section 166 order earlier this year, requiring the company to appoint independent experts to examine its internal systems and controls.
The order came around the time Revolut finally secured its full UK banking licence in March after a multi-year wait. Regulators sought greater assurance about the robustness of the group’s governance as it prepared to expand its product range under the new authorisation. A section 166 review, also known as a skilled-person review, is a standard supervisory tool that places the cost of the examination on the firm itself and can lead to recommendations, remediation plans or further regulatory action if material weaknesses are identified.
Revolut has grown at extraordinary speed since its founding little more than a decade ago. It now serves more than 80 million customers and carries a valuation of approximately $115 billion, placing it ahead of several established high-street banks in market terms. The UK banking licence was viewed as a critical milestone that would allow the company to take deposits, offer lending products and pursue its longer-term goal of operating in 70 countries by 2030, up from its current footprint of around 40.
The timing of the review coincides with Revolut’s first significant moves into credit products in the UK. The company has begun offering unsecured personal loans ranging from £2,000 to £25,000, marking its entry into a market long dominated by traditional lenders. The expansion forms part of a broader strategy to deepen its relationship with customers beyond payments, foreign exchange and current-account services.
Regulators have previously expressed concern about whether Revolut’s risk, compliance and product-approval frameworks can keep pace with its growth. Last year the European Central Bank identified deficiencies in the company’s European product-approval processes and imposed growth restrictions while requiring a third-party review of relevant functions. Similar questions about control environments featured in discussions that delayed the UK banking licence.
Neither Revolut nor the Bank of England has publicly commented on the section 166 order. Such reviews are typically conducted confidentially, with the findings shared between the firm and its supervisors. The outcome can range from relatively light recommendations to more substantial requirements for process changes, additional capital or restrictions on new product launches until improvements are demonstrated.
For a fast-growing digital bank, product-approval processes sit at the heart of both commercial ambition and prudential safety. Rapid iteration is part of the fintech model, yet each new product introduces operational, credit, conduct and financial-crime risks that must be assessed and mitigated before launch. Supervisors want evidence that these assessments are thorough, independent and consistently applied across the organisation.
The review also takes place against a backdrop of heightened attention on the operational resilience of digital-first banks. As customer numbers scale into the tens of millions, the systems that support product design, risk scoring, compliance checks and customer onboarding must perform reliably under pressure. Any gaps identified by skilled persons could influence the pace at which Revolut is permitted to roll out further lending or deposit products in the UK.
Industry observers note that section 166 reviews have become a more frequent feature of supervision for both traditional banks and newer entrants. They provide regulators with independent insight without immediately resorting to formal enforcement. For the firm under review, the process can be resource-intensive but also offers an opportunity to strengthen controls and demonstrate maturity to supervisors.
Revolut’s trajectory from payments app to multi-product banking group has been one of the most closely watched stories in European fintech. Its ability to attract customers with low-cost foreign exchange, seamless digital accounts and an expanding suite of services has disrupted established players. At the same time, the regulatory path has been longer and more demanding than many early observers expected, reflecting the heightened scrutiny that accompanies systemic importance and the shift from e-money to full banking status.
The current review does not prevent the company from continuing to operate or from launching products already approved. It does, however, place additional focus on the quality of its internal decision-making and the documentation that supports those decisions. Supervisors will be looking for clear lines of accountability, adequate challenge from risk and compliance functions, and evidence that lessons from earlier product launches have been incorporated into current processes.
As Revolut begins to compete more directly with high-street banks in the UK lending market, the strength of its product-approval framework will influence both regulatory comfort and customer confidence. A successful outcome to the review would remove one source of uncertainty and allow management to concentrate on execution. Any material findings would likely require time and investment to address before the next phase of expansion can proceed at full speed.
The development illustrates the continuing tension between innovation speed and the measured pace preferred by prudential regulators. Digital banks that scale rapidly inevitably attract closer supervision as their customer bases and balance sheets grow. The section 166 process is one mechanism through which that supervision is exercised.
Further details of the review’s scope and any eventual findings are unlikely to become public unless they result in formal enforcement action or public statements by the company. In the meantime, Revolut continues to operate under its UK banking licence and to develop its product set, while the skilled-person examination proceeds in the background.
Official information on the regulatory framework governing UK banks is available from the Bank of England. Coverage of how digital banks are navigating technology, compliance and growth can be found on platforms such as Business Tech.
