Revolut User Base Grows Alongside Auditor Warnings

All-in-one FinTech platform Revolut’s first full year of profit is now coming under question.

This, as the company’s auditor BDO LLP warned that Revolut’s 2021 revenues may have been “materially misstated” per a report Wednesday (March 1) by the Financial Times (FT).

At the very least, the company’s user base continues to grow — from around 16 million in 2021 to over 27 million today.

The 2021 crypto boom spurred a tripling of revenue for Revolut, generating $769 million compared to $266 million for its 2020 results, and helped the company reach profitability for the first time.

The company’s cryptocurrency offering now accounts for less than 5% of revenue.

“In 2021 we made considerable progress in meeting our ambitious goals, notably, hitting our first full year of profitability,” wrote company Chairman Martin Gilbert in a statement accompanying this week’s (Feb. 27) release of the 2021 numbers.

An $800 million funding round in the summer of 2021 valued the business at $33 billion, as reported at the time by PYMTNTS.

Everything appeared to be moving up and to the right, despite the company failing to release its financial results on time.

But those financial results are turning out to be a big sticking point.

Per the FT report, BDO issued a qualified opinion on Revolut’s overdue 2021 accounts because the design of the FinTech’s IT systems meant that for up to two-thirds of revenue, BDO was unable to provide sufficient appropriate assurance over how Subscription, Card Delivery and Foreign Exchange and Wealth revenue streams were allocated.

“Keen management of our balance sheet, alongside improvements to financial systems, processes and controls, stand as the two priorities of the finance and treasury teams,” said Mikko Salovaara, Revolut’s CFO.

Revolut has been seeking a U.K. banking license since early 2021, and PYMNTS noted last year that the company was facing pressure to improve its internal financial reporting controls, after the U.K.’s Financial Reporting Council found the company’s audits were flawed and had a high risk of “misstatement.”

Those findings turned out to be prescient.

A U.K. banking license could increase Revolut’s profitability as higher interest rates make deposits more valuable, as well as help clear the way for the platform to receive licenses in other markets.

The FinTech has so far received a full banking license from the European Central Bank (ECB), and is regulated by the Bank of Lithuania.

As reported by PYMNTS, the U.K.-based FinTech is targeting a growth goal of 100 million users and is looking to Asia, particularly Japan, to help accelerate its already rapid growth, with a soft target of growing to at least 10 million users across the Asia-Pacific (APAC) region by 2025.

Revolut’s core product is an account that allows users to send, hold and receive money,  combined with a payment card.