Revolut’s net profit more than doubled last year to £790 million (€922 million), driven by card fees and interest earned on surplus deposits placed with central banks, as the London-based fintech prepares to boost its lending by launching mortgages this year.
Profit for the year rose by 129 per cent, according to Revolut’s latest annual report, published on Thursday.
Group revenues rose by 72 per cent to £3.1 billion. The biggest contributor was $790 million of net interest income, which rose 58 per cent, as Revolut placed more of its growing excess deposits with central banks, including the European Central Bank (ECB), and “reputable financial institutions”, according to the report.
The ECB deposit rate was 4 per cent for the first half of 2024, but had fallen to 3 per cent by the year end.
Card payment revenues – including fees on international money transfers, merchant fees for transaction processing, and charges on cash withdrawals outside customer plans – rose 43 per cent to £694 million.
Revenues from foreign exchange increased 58 per cent and those from wealth products rose 298 per cent to £422 million, driven by crypto and equities trading. Subscription revenues for its various plans – which are as expensive as €55 a month, for its Revolut Ultra card – advanced 74 per cent to £423 million.
Total customer balances rose by two thirds to £30 billion, including money held off Revolut’s balance sheet in money market funds and with partner firms. Deposits held on balance sheet amounted to £22.3 billion, while its fledgling lending business – mainly personal loans – stood at £979.3 million, leading to a very low loan-to-deposits ratio of 4.4 per cent.
Revolut has previously said that it plans to start mortgage lending this year, initially in Lithuania, home to its euro zone banking licence, and followed by the Republic of Ireland, where customers rose 14 per cent last year to 3 million. Some three-quarters of adults in the State are now Revolut customers, according to the company.
“We began internally testing mortgages in 2024, moving us one step closer to being a part of one of the biggest financial decisions of our customers’ lives,” group chief executive and co-founder Nik Storonsky said in the report.
Revolut received its second banking licence in Mexico earlier this month and is hoping to secure full authorisation in the UK – its main market, with more than 50 million customers – this year. UK regulators gave Revolut a restricted licence, following a three-year wait, last July, after the group managed to file its first annual report in years without needing a deadline extension.
Full banking authorisation in the UK is seen as a major milestone before an initial public offering (IPO) of the Softbank-backed group, which industry observers expect to take place next year.
The group was valued at $48 billion last month by Schroders Capital Global Innovation Trust, an investment trust that has a small stake in the company. That marked an upgrade from the $45 billion value last summer when Revolut completed a secondary share sale to provide more liquidity for employees.
