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Revolut Could Be Headed to South Africa

Revolut, one of the world’s biggest digital banks, is considering launching in South Africa.

The company started in the UK in 2015, founded by Nikolay Storonsky and Vlad Yatsenko, and now has over 52 million retail customers in 48 countries.

Revolut is known as a “neobank” because it operates fully through its mobile app. It offers free and paid accounts, debit and credit cards, savings, loans, and even trading in shares and cryptocurrencies.

In 2024, the company was valued at $45 billion. As part of its plans to grow globally, it’s looking at new markets like Mexico, Brazil, India…and now possibly South Africa.

A Strong Year Behind Them

Revolut has seen massive growth in the past year, with its 2024 financial results showing a 72% jump in revenue to $4 billion.

What’s interesting is that this growth came from people using more of its services (not just from signing up new customers). Card payments rose 43% to $887 million, and subscription revenue climbed to $541 million.

Revolut’s Wealth division, which includes things like investments, grew by nearly 300%. The company also added 15 million new users in one year and is now pushing into new countries while applying for banking licences across the globe.

To compare that to some of SA’s big banks: Revolut’s 2024 net profit of approximately R23.8 billion positions it pretty competitively compared to South Africa’s major banks. 

For instance, Standard Bank reported headline earnings of R44.5 billion, while Nedbank achieved R16.9 billion. Capitec’s earnings stood at R10.6 billion. 

So, this gives you a feel for just how big Revolut actually is and they are currently shooting the lights out internationally.

SA Is a Tough Nut To Crack

Now this global giant is eyeing new markets, including South Africa but Revolut does launch in South Africa, it will face strong competition.

The banking sector here is dominated by Absa, Standard Bank, FirstRand, Nedbank, and Capitec (the so-called “Big Five”) who hold almost 90% of customer deposits and loans.

These banks have already heavily moved into digital banking to fend off growth by the newer app-based banks like TymeBank and Discovery Bank, which have both gained over a million customers. And that’s not to mention Postbank or Old Mutual’s plans. There is an argument to be made that the local banking market is saturated.

‘There is an argument to be made that the local banking market is saturated’

Any new digital bank will face competition and have to build trust with potential clients. It can take a while for new market players to become profitable. Discovery Bank, is interesting in that it is already profitable and along with TymeBank offers a similar all digital experience to Revolut.

So, while South Africa could be a great opportunity for this international banking giant, it won’t be an easy win.