Revolut chief Nikolay Storonsky: ‘We are going to cause the same disruption in investments as we have done in banking’
Revolut chief Nikolay Storonsky: ‘We are going to cause the same disruption in investments as we have done in banking’

Revolut plans to launch a commission-free share trading service for its more than 2m users, positioning the start-up as one of the most aggressive digital challengers to British high street lenders.

The company, which allows people to transfer and spend money in 120 currencies with no fees using a pre-paid card and digital wallet, will on Thursday announce plans to offer a free service to trade in UK and US shares.

The move mimics the fast-growing service already offered by Robinhood to more than 4m people in the US. It underlines how fintech companies are rapidly branching out to offer a range of services beyond their initial area of specialisation as they seek to add more customers.

“To put it bluntly, we are going to cause the same disruption in investments as we have done in banking,” said Nikolay Storonsky, the Russia-born chief executive of Revolut who created the company in 2015 after working for Lehman Brothers and Credit Suisse.

“Brokers are charging people as much as £5 per trade and the user interfaces are typically clunky, slow and confusing for consumers,” he said. “The pain points are clear for us and the room for improvement is massive.”

Revolut has expanded rapidly since starting its pre-paid cards service four years ago and is applying for a European banking licence in Lithuania. It recently grew to more than 2m customers, double the level of six months ago, of which about half are based in the UK and half in the rest of Europe.

Earlier this year it launched a new service allowing its users to invest in three cryptocurrencies — bitcoin, litecoin and ether — in addition to products in travel insurance and consumer loans.

The company, which says it is signing up 6,000 to 8,000 new customers a day, has applied for a licence with the Financial Conduct Authority to act as a broker buying and selling shares itself.

In the meantime, it plans to launch the share trading service in the next four to six months in partnership with an established brokerage, shouldering the cost of commissions it pays on behalf of its users. It plans to expand the service to European shares after it is launched.

In April, Revolut announced a $250m fundraising— led by Russian venture capitalist Yuri Milner’s DST Global — which valued the company at $1.7bn, more than five times the level of its last round of investment in 2017.

Earlier this year it said it had broken even on a monthly basis. The company plans to launch its pre-paid cards service in the US in August or September.

Robinhood, which has some investors in common with Revolut, including Index Ventures and Ribbit, was recently valued at $5.6bn in its latest fundraising and has diversified into trading options and cryptocurrencies.

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