Revolut is poised to unveil its first lending product in Australia, more than seven months after it obtained a credit licence from the local corporate regulator.
The group appears to be on the cusp of launching an unsecured personal loan following a move last week to incorporate a standalone lending arm that will trade as Revolut Australia Credit Services Pty Ltd.
A few industry commentators had expected Revolut to begin marketing digital personal loans earlier this year, but the company has taken longer than expected to complete the product development.
In a target market determination statement posted on its Australian website, Revolut says its personal loans will only be marketed to customers already holding registered accounts with the payments company.
New customers will be eligible to apply for unsecured credit but will be required to wait 30 days after opening a Revolut account for their loan applications to be assessed.
The loan will not be available through brokers or other third party channels, with the company revealing in the target statement that intending borrowers will only be able to apply through the Revolut mobile App or the company’s proprietary website.
While Revolut is promising that the loan will carry no establishment fees or account keeping fees, the company plans to use risk-based pricing to set interest rates for individual borrowers.
Despite clear progress on the rollout of its lending business, mystery continues to surround Revolut’s prospects in its bid for an Australian banking licence.
The company has been engaged in a formal process since August 2021 when it lodged its licence application with the Australian Prudential Regulation Authority.
However, its efforts to secure a local banking authority could potentially have been upset by the inability of the parent company to secure a deposit-taking licence in its home market from UK regulators.
Revolut is yet to publish its consolidated financial accounts for the 12 months to the end of December 2022 and only filed its 2021 accounts to UK regulators in March.
While Revolut reported a 2021 bottom line profit of £26 million, the group’s auditor qualified his opinion of the company’s disclosures after concluding that its IT systems were not designed in such a way that allowed for IT or business process controls to be effectively tested.
“Verification procedures are not able to provide sufficient appropriate assurance over Subscription, Card Delivery and Foreign Exchange and Wealth revenue streams,” wrote BDO auditor Matthew Hopkins in his qualified opinion.
“As a result, we were unable to satisfy ourselves by the execution of such procedures or by alternative means concerning the completeness and occurrence of revenue within these streams totalling £476,856k which is included in the Statement of Comprehensive Income and Note 6 of the financial statements for the year ended 31 December 2021.
“Consequently, we were unable to determine whether any adjustments to this amount or related amounts were necessary.”