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A disagreement has reportedly emerged between UK Chancellor Rachel Reeves and Bank of England Governor Andrew Bailey over the stalled progression of Revolut’s banking licence, underscoring tensions between political ambition and regulatory independence.
Revolut secured initial approval for a UK banking licence last year after a prolonged three-year process with regulators. The licence marked the beginning of a mandatory “mobilisation phase,” during which the fintech firm’s banking arm is restricted to holding just £50,000 in total deposits while it enhances its operational infrastructure and control systems.
Originally expected to exit this phase within 12 months, Revolut has yet to make further regulatory progress. The deadline quietly passed on July 25 without an update from either the Prudential Regulation Authority (PRA) or the company.
According to a report by the Financial Times, Chancellor Reeves sought to convene a high-level meeting involving the Treasury, the PRA, and Revolut to address obstacles delaying the transition out of mobilisation. Citing individuals familiar with the matter, the report claims Reeves advocated for expedited clearance to enable Revolut to fully operate under its licence.
However, the meeting was allegedly cancelled following intervention by Governor Bailey, who was said to be concerned about maintaining the Bank of England’s operational independence and avoiding any perception of political influence in regulatory decision-making.
In response, the UK Treasury stated: “The Chancellor and the Governor have a strong and productive relationship, and the government fully supports the operational independence of the Bank of England.” The Bank of England and Revolut declined to comment on the matter.
The episode reflects broader tensions in balancing the UK’s ambitions to foster innovation in financial services with the need to uphold rigorous regulatory standards and institutional autonomy.
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