No it's not, unless you are a customer in Lithuania.
Wirecard is a payment processor, Revolut is a bank, these companies are essentially different industries and are regulated differently. We should not mix the two up.
Even if you're a Revolut customer in Lithuania I'll lay money you are a customer of the payment processor and not the bank. I suspect the bank license is for technical and treasury management reasons and not a customer facing entity
much more like leaving money with a stockbroker client account afaiu.
Again, they're not a bank.We'd wanna be careful not to cause a run on them
He conflates its wonderful functionality with competence and protection.
No, it's not a bank.
You should read up a bit before you correct other people.
Revolut offers banking services such as savings and debit cards for retail users...
...Revolut does have a banking license in Lithuania, but trades through an e-money license in Ireland, so the regulation is different to that of say BofI.
...However, the premise outlined here is that because Wirecard a 'FinTech' has gone due to Fraud, that Revolut another 'Fintech' is also susceptible.
My two cents, is that e-money regulation is going to be enhanced via PSD3 and other regulation in the coming years as European regulators really focus on a customer-centric platform based form of regulation. We have already seen this in PSD2 with more authority given to the EBA. Payments is still a rapidly evolving area.
Revolut offers banking services such as savings and debit cards for retail users, whilst Wirecard operates in the payment processing space for businesses. Revolut does have a banking license in Lithuania, but trades through an e-money license in Ireland, so the regulation is different to that of say BofI.
However, the premise outlined here is that because Wirecard a 'FinTech' has gone due to Fraud, that Revolut another 'Fintech' is also susceptible. My opinion, is that is an example of a casual connection fallacy. They are independent companies, and whilst Revolut has its own business model challenges. In fact, even under a more stringent regulatory environment that a banking licence brings we can't be sure that the WireCard fraud would have been caught, as regulators do not audit. Fraud of this nature is a company-specific event, so every company has an element of fraud risk associated, the Fraud at Wirecard shows no indication of this being a systemic industry-wide occurrence. My biggest concern is the strength of auditors and their ability to find fraud examples in any industry.
I agree with the points on using Revolut you are putting your trust in a loss-making technology firm, but that is a completely independent issue to the Fraud at Wirecard. I also, do not disagree with the suggestions of keeping money in Revolut, I am just trying to bring the conversation back to the original question rather debating the risk of keeping money in revolut.
My two cents, is that e-money regulation is going to be enhanced via PSD3 and other regulation in the coming years as European regulators really focus on a customer-centric platform based form of regulation. We have already seen this in PSD2 with more authority given to the EBA. Payments is still a rapidly evolving area.
Definitions are important - Revolut doesn't offer banking services. It can't do that without contracting as a bank. It offers payment processing and maintains customer cash with another (actual) bank
It's clear that there is no connection between Wirecard and Revolut.
But the demise of Wirecard highlights something important - people who have money lodged with it are not protected in the same way that they would be protected were it a bank.
It also highlights that a company can be very successful and provide a really fantastic service but if it's not making profits, its customers are at risk.
I am shocked at the reports of people who have large amounts on deposit in their Revolut account. The risk might be small, but the consequences would be huge.
It would probably be a good regulatory mover for Revolut to refuse to allow deposits which bring the balance to in excess of, say, €3,000.
Brendan
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