Good New for Revolut: Swiss IBAN and banking license

Categories Budget, Frugality, Investment, Spending
Good New for Revolut: Swiss IBAN and banking license!

Some good news has just arrived for Revolut! Recently, I saw by luck that there was a Swiss IBAN available when adding money to the application. This is really great since that was missing from the start on the Revolut account.

And probably even bigger news for Revolut: they got a European Specialised Bank License! This is a big deal. Revolut is now officially a bank and will soon start offering new services. I have been using Revolut for about six months now and I really like it. I have saved some money by using their free currency exchange services. I am really interested to see how they are going to implement this banking license in the future. I would really like to have a cheap and good bank account in the future.

In this post, we are going to see what do these changes mean for me and other Revolut customers! If you do not know about Revolut, stay tuned!

Revolut

Revolut is a kind of digital bank alternative. It is not yet a bank. But you can store money in any currency on your account. In theory, you could even use it to deposit your salary into it. But since they are not a bank, you have fewer guarantees on it.

The biggest advantage of the Revolut account is that you can convert currencies for free! Most credit cards will charge a hefty fee to convert currencies. For instance, my current credit card charges me 1.5% to do a transaction in a foreign currency. This is the main reason why I started using Revolut. I have already saved quite some money with Revolut and all of it is for free! Now I only use Revolut for my expenses in foreign currencies. I have been using it for almost six months and I am really happy about it!

Swiss IBAN

If you want to transfer money to your Revolut account, there are several ways:

  • Use a Debit Card (free)
  • Use a Credit Card (fees)
  • Transfer to a bank account (free)

The most convenient one is to transfer money from your bank account to Revolut IBAN. The main issue with Revolut before was that they did not have any Swiss IBAN. They had an IBAN from the UK on which you could pay with CHF. However, everytime you transfer money, you need to pay a small fee because Swiss banks do not provide free transfers to IBAN outside of Switzerland even if it is in CHF.

Until now, I was using a TransferWise account to make the transfer for free. In that case, I was transferring money to my TransferWise account from my bank. And from there, I was transferring money to my Revolut account. It was working quite well and was free. However, that means I had an account I did not use and a card I only used for some transfers.

Now, Revolut just got a CHF IBAN from the Credit Suisse! With this, I can transfer money directly into my Revolut account with a single bank transfer. And for free!

That means I do not need to use TransferWise anymore for now. This will simplify my money management!

Banking License

Revolut will soon be a bank!
Revolut will soon be a bank!

Until now, Revolut was not a bank but simply a digital banking alternative. This has quite a few difference. For instance, Revolut could not offer you credit options and your money at Revolut was not insured.

However, this will soon change! Indeed, in December 2018, Revolut got a Specialised Bank License from the European Central Bank. They used the Bank of Lithuania as a facilitator in the proceedings. They are not yet a full-range bank since they only got Specialised Bank License. For instance, they cannot provide any investment services.

Nevertheless, this is great news and will soon benefit the users of Revolut. The biggest advantage will be that soon, money deposited on a Revolut account will be insured up to 100’000 EUR. This is guaranteed under the European Deposit Insurance Scheme (EDIS).

Another advantage, but less interesting in my opinion, is that they can offer your personal loans. You can also go negative in your bank account. This was not possible before. I do not think it is a great thing since you should not go negative anyway. But it remains to be seen how much interest will be billed on these loans.

For now, nothing changed. They are going to start with this new license in Lithuania for now. But then, they plan to extend in the other European countries. We probably will not see any change in Switzerland for at least a year. But eventually, it will come!

Overall, I believe this is great news for Revolut and for its customers.

Conclusion

All this is really great for both Revolut and its customers. For Swiss investors, that means that it will not be necessary to use TransferWise as an intermediary to transfer money for free to our Revolut account. This will simplify my money management routines. And it will also simplify my net worth routine since this means one less account.

And for all Revolut customers, it is great that Revolut will become a bank! For now, nothing changed yet. We will see in the future how they will implement this banking license. But I think next year will be a very interesting year for Revolut and its users. The only thing they are missing is a cashback credit card! But we can always use a credit card like the one from Migros and pay from a Revolut account.

I would not be surprised if, in a few years, Revolut becomes a serious alternative to Swiss banks. I had to change banks recently and it was quite a pain to do. Most Swiss banks are actually quite bad. If the money was insured in Revolut and we could have an account, I would probably change my main bank account for a Revolut account. We will see how they evolve in the future.

What do you think about this news? Do you already use Revolut?

6 thoughts on “Good New for Revolut: Swiss IBAN and banking license”

  1. it would be great if the revolut card would work as a credit card and not only debit. It’s a pain not to be able to use it for security deposits (hotels, car rentals, even some gas stations in the US )

    1. Hi Zoli,

      Yes, it would be really great if we could use it like that!
      The other great thing would be if there was some cashback on it or any other benefits on it as well.

      But for all foreign exchanges, it is the best card!

      Thanks for stopping by!

  2. Does it mean, that I can now use my Revolut CHF sub-account as a regular Swiss account (salary, taxes etc.)?

    This would be a good news, as most of the Swiss accounts are not as cheap (free) as in other countries – correct me if I’m wrong.

    1. Hi P,

      I think it is a bit early for that. If your company does a SWIFT transfer, that would probably work. But for other transfers, you still need a reference code. You do not have your own IBAN.
      And for now, they are not yet a bank in Switzerland. They will implement that over time, starting with other countries. So that means that for now your money on Revolut is not insured by the government.
      Once they are offering bank accounts in Switzerland, it may be very interesting to use their services indeed! But for now, I would not go that.

      Thanks for stopping by :)

  3. Very cool! I will definitely be looking into this as European inter-bank transfers become more and more common for me (my side hustle has me working for a UK and Spanish company). Also when going on holidays it’s always nice to have a card to do foreign currency transactions without fees. I will look into this possibility from The Netherlands!

    1. Hi B,

      Yes, it is very good if you do a lot of bank transfers in different countries.
      If you need cash in other countries, it is still not great since there is a very small limit (200 EUR) on what you can withdraw in cash at an ATM. This is a bit limiting.
      Getting cash in other countries at a fair price is something I have not been able to figure out yet.

      Thanks for stopping by :)

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