Revolut has been pushing hard to establish itself as a major player in the Asia-Pacific region for about six years now. While they have successfully entered markets such as Singapore, Japan, Australia, and India, their plans to enter China in 2021 did not materialize. However, with the company recently reporting a profit of £438 million, an increase from a loss of £25.4 million the previous year, it is likely that they will focus more on expanding in the APAC region in the near future. Revenue nearly doubled to £1.8 billion, indicating strong growth for the company.
In Singapore, Revolut’s business has seen significant growth, with user numbers increasing by 77% in 2023, e-wallet balances rising by 52%, and overall card payments increasing by 83%. However, the company has faced challenges due to stringent capitalization requirements that prevented them from applying for a digital banking license in Singapore. Despite this, Revolut has introduced new products such as Flexible Accounts and increased e-wallet limits in the country to attract more users.
The company’s progress in India has been slower compared to Singapore, with Revolut focusing on payments before expanding into trading, investment, and credit segments. In April, the Reserve Bank of India granted them authorization to issue prepaid instruments, but they have not made significant strides in the market. Revolut pledged to invest US$45 million in India in 2022, but its success in the country remains uncertain due to strong domestic competition and regulatory challenges.
Australia and New Zealand offer Revolut significant opportunities for growth in the APAC region, as the markets are similar to the UK and the company already has a lending license in Australia. Revolut plans to offer credit cards in Australia and increase unsecured lending to cater to the rising demand from cash-strapped households. The company sees potential in unsecured debt as traditional banks focus more on mortgages than consumer credit.
In terms of future prospects, Revolut’s success in obtaining an authorized deposit-taking institution (ADI) license in Australia could depend on whether they receive a banking license in the UK, a process that has been ongoing for about three years. Approval for a UK banking license would boost Revolut’s credibility and increase its chances of obtaining an ADI license in Australia. However, if the UK banking license is not granted, it could complicate their operations in Australia.
Moving forward, Revolut faces challenges in expanding its business in both Singapore and India, as they need to prove their value proposition to customers in these competitive and regulated markets. Despite its strong financial performance, the company will need to work harder to overcome skepticism and establish itself as a successful player in the APAC region. Revolut’s future success in the region will depend on its ability to navigate regulatory hurdles, competition, and market demands effectively.