Digital banking alternative Revolut plans to challenge banks in Malta by targeting 60,000 Maltese customers by the end of the year. The startup also plans to extend its rapidly growing mobile app business into commission-free trading for stocks, exchange-traded funds and options.
London-based Revolut already has 25,000 customers in Malta, reports Malta Today, roughly 6% of the population.
The company’s CEO Nikolay Storonsky says, “The big banks in Malta have been taking advantage of their customers for years with endless banking fees and crappy technology.”
Prime Minister Joseph Muscat, who worked toward establishing a clear regulatory framework for fintech startups, blockchain entrepreneurs and several cryptocurrency exchanges that have relocated to Malta, such as Binance, OKEx and Bitbay, is welcoming Revolut with open arms.
Revolut is just getting started. Storonsky says it’s opening over 7,000 new accounts each day in addition to lining up 60,000 customers on its waiting list for the US launch. It offers users a way to make free international money transfers and free international ATM withdrawals, and to spend fee-free globally with the real exchange rate. Storonsky says that Revolut is “here to end the party for the bankers” and a financial system that’s designed around commissions and fee-charging intermediaries.
The conversion of traditional banking customers in Malta is part of Revolut’s larger strategy of using the power of fintech and mobile devices to flip the international financial banking industry upside down. Revolut has major appeal for Millennials who use smartphones and tablets for everything from social media to trading to checking bank balances and watching videos.
According to a global study by ING, mobile banking has exploded in recent years. Currently, 76% of US consumers check their balance or last transaction on a mobile device, compared with 18% who use their laptops or desktop computers.
In Australia, 68% check on mobile compared to 29% on desktop. Consumers checking balances through bank visits are 6% and 3%, respectively. The European average for checking bank balances also heavily favors mobile at 65%, with 32% on desktop and 3% making bank visits.
The mobile-banking trend is spurring the epic rise of fintech startups such as Revolut and US-based Robinhood, as they effectively move banking away from physical locations to mobile apps, challenging retail bank branches the way Netflix challenged Blockbuster.
Launched in 2015, the European company reports that it has three million customers who have sought out alternatives to traditional banking, generating Revolut’s $22 billion in transactions to date and saving customers $740 million in fees.
Like Robinhood, a commission-free trading platform with five million users, Revolut announced in June that it plans to launch a commission-free trading platform for ETFs, options and stocks from British and US listed firms. Both Robinhood and Revolut already offer cryptocurrency services.
The Revolut app allows users to buy, hold and exchange major cryptos such as Bitcoin, Ethereum, Litecoin, XRP and Bitcoin Cash with 25 fiat currencies. Robinhood Crypto, a commission-free crypto trading platform, was launched in February.
As both companies keep pace with shifting consumer behaviors, they’re expanding the digital economy ecosystem and effectively forcing incumbents to trim the fat from their legacy systems, prioritizing the implementation of new cost-saving, digital strategies.
In October Storonsky will give a keynote speech at the Delta Summit, Malta’s blockchain and digital innovation summit.