Revolut to apply for banking license in California

U.K.-based challenger bank Revolut, which has 13 million customers, plans to apply for a banking license in California, CNBC reported.

Why should we care?
Revolut is applying for a banking license seven months after launching in the U.S., offering accounts through a partnership with Metropolitan Commercial Bank. By applying for a charter with the Federal Reserve Bank of San Francisco and California’s Division of Financial Institutions, the fintech will be able to lend throughout the U.S. through interstate agreements. Revolut’s pursuit of a charter follows efforts of other financial upstarts in acquiring banking licenses, including crypto exchange Kraken, which received a bank license in Wyoming last month; Varo, which acquired a national bank charter in July; and Square, which obtained an Industrial Loan Company charter in March. Revolut’s choice of a state-level license instead of a national charter may draw questions from industry analysts, but the company will likely use the license to launch more products and further differentiate against other challengers. Revolut is valued at $5.5B.