Revolut is gaining international popularity among businesses and consumers. It’s advertised as a platform for global spending and money transfers without exorbitant fees. Naturally, this service is something that people who travel a lot would be interested in.
In this review, we’ll see how Revolut works, whether it is safe for Australians to use it, the main features, pros/cons, and customer reviews. Overall, you’ll learn everything you need in order to come to the right decision.
What Is Revolut?
Revolut is a digital bank. Initially, it was launched as a card for travelers with the advantage of having adequate exchange rates and quick money transfers. Over time, the platform expanded into several other areas.
The initial launch took place in the UK and was devised by Level39, a financial technology incubator in London. The founders saw an opportunity in this niche as they were wasting hundreds of pounds on foreign transaction fees while traveling. As a solution, they thought of a multi-currency card. At the moment, the app supports:
- spending and ATM withdrawals in 120 currencies
- sending in 29 currencies
- access to cryptocurrencies (Bitcoin, Ethereum, Litecoin, Bitcoin Cash, and XRP)
- exchanging crypto to or from 25 fiat currencies
In 2019, Revolut launched in Australia. The company is still registered in the UK, and the Financial Conduct Authority (FCA) remains the main regulatory body. In terms of the local regulations, the Australian Securities and Investments Commission (ASIC) permits the service to operate in Australia.
However, Revolut doesn’t have an Australian Deposit-taking Institution (ADI) license. That means that for the time being, all transactions that Australian customers make will be processed through an unnamed local bank using a trust account.
How Revolut Works
Revolut is an app-based product, and the sign-up is pretty quick. You need to download the mobile app and register without the proof of address or credit score verification. That said, you need to provide valid identification. Then you will receive a contactless card.
After the registration, you will gain access to the following functionalities:
- Current account (balance of payments) – This provides a range of regular banking services, such as receiving money (salary, pension, benefits payments), paying bills, making recurrent payments, making contactless payments (Apple Pay, Google Pay), etc.
- Global transfers – Money transfers to 29 countries. It’s useful for companies, individuals, banks, and settlement institutions that operate in at least two different countries.
- Fee-free transactions – Users aren’t charged for international spending within the app itself. However, technically there are still interbank fees that banks require from anyone.
- Multi-currency account – The account allows you to hold, send, and receive funds in 29 foreign currencies.
- Bill-splitting – To avoid the clumsy process of splitting the bill, the app lets everybody keep a running total of who owes who what.
- Spend tracker – This function transforms Revolut into an expense manager app with categories, money-saving features, card freezing, and spending limits.
- Device and medical insurance – You can add insurance coverage and pay by the day while on a short trip abroad.
- Buy and sell cryptocurrency – Cryptocurrency exchange isn’t currently available to Australians. But if you’re traveling somewhere, such as the UK, you can take advantage of this functionality.
Key App Features
Revolut’s capabilities are split into several sections. Below are the descriptions of some of the major ones.
This section summarizes all your accounts and their respective balances. For example, you can see the currency accounts that you’ve set up (AUD, USD, GBP, etc.). Here you can see your linked accounts, junior accounts, peer-to-peer platforms Lending Works, and other features.
You can also set up your virtual and physical cards. It includes features such as security settings, view/unlock your pin, set a monthly limit, and a lot more.
This one is the primary feature of this platform. In this section, you can send and receive money transfers from other users or bank accounts, arrange recurring payments, and split bills. There is an interesting feature called Vault, which directs spare change from transfers and recurring payments into a separate savings account.
This one includes multiple subcategories. Here you can manage your insurances, commodities, cryptocurrencies, lounges & smart delays, and even a concierge service. There is also a watchlist for interbank exchange rates that alerts you when the rates go beyond a certain threshold.
Revolut’s customers can receive discounts after the 10th transaction, donate to charities, and see the nearest ATM to their current location. Overall, there are multiple features that go beyond regular banking transactions.
Even though the main premise behind the Revolut’s marketing campaign is that it has no fees, there are some things users should know about. We’ll go through all fee categories one by one to give you a general idea of what to expect:
- Account opening and maintenance fee – Opening a new account isn’t associated with any charges. Plus, there are no account keeping fees.
- Card fees – If you opt for a free plan, you will need to pay 9.99 AUD for the delivery of your physical card. If you opt for a premium account, this fee will be included in the cost of the account.
- ATM fees – If you withdraw money with a limit of 300 AUD per month, there are no ATM fees. If you go over the limit, it will charge an extra 2% for each transaction.
- Transfer fee – The Revolut app doesn’t charge you for the money transfers to international banks. However, you may face bank fees, depending on which one you’re sending money to. If you use SWIFT, you will need to check with their specific terms.
- Currency exchange fee – This option is free unless you go over the limit of 9,000 AUD per month. After that, you will have to pay 0.5% extra. However, if you’re exchanging currencies on a weekend, the fee is 0.5-2.0% for the exchange for all types of accounts.
- Top-up fee – Card top-up from a Visa/Mastercard credit or debit card costs up to 3%. Bear in mind that your regular bank may incur additional charges for sending funds to the Revolut card.
Is Revolut Safe?
Revolut’s security policies are robust, and there haven’t been cases of cybersecurity exploits or leaks. The platform uses a ring-fence method, which is a virtual barrier for segregating a portion of an individual’s or company’s financial assets. This ensures an additional level of security for the client funds.
Revolut is also authorized by the Financial Conduct Authority. This means that it follows the requirements of the Payment Services Regulations of 2017 and Electronic Money Regulations of 2011.
You can lock or unlock your account if you notice some suspicious activity, have lost your password or phone, or anything like that. Also, you can disable some features when you don’t need them, such as contactless payments, ATM withdrawal permission, online transactions, etc.
Much like any financial institution, Revolut employs special algorithms to detect and prevent fraud and money laundering. However, the service has been under scrutiny because of improper automated suspension of accounts.
The company explained that they lock the account for a review by a compliance agent. However, the problem is that it takes them a long time to address such cases. Revolut doesn’t have enough agents for all automated suspensions, and they don’t allow suspended users to contact the support channels. Instead, users have to interact with automated responses from a chatbot.
As a result, funds can be locked for months. There have been cases where customers had unsuccessful attempts to recover tens of thousands of dollars. For example, one particular company was unable to pay its staff without any justification being given.
Pros and Cons of Using Revolut
Below is a table of reasons why Revolut is a good choice for you and some considerations that you should be aware of.
|An array of expanding extra featuresWide range of currencies with affordable transfersQuick application processFee-free ATM withdrawal even abroadEasy insurance paymentsGood security featuresBasic crypto exchange and shares trading||Limited capabilities in AustraliaNot completely fee-freeNo physical bank branchesLimits of cash withdrawalsNo deposit guaranteesPoor customer service|
Is Revolut Right for You?
Revolut’s main intention is to bring convenience and affordability to international spending and transfers. To fulfill this intention, the service offers various card options and in-app functionalities. If handled correctly, it could become a part of a comprehensive money management strategy.
This has the potential to be an indispensable tool for those who constantly travel and deal with multiple currencies. This applies to all kinds of users – individual travelers and international companies. The fee structure is also beneficial in numerous situations.
On the other hand, Revolut’s controversies raise some concerns. While wrongful account locks don’t happen with the majority of users, it’s an issue nonetheless. This could potentially mean losing all your funds for an unspecified amount of time and with only a vague chance of recovery. Also, the fact that the service is solely app-based can be a turn-off for some people.
Lastly, Australians should remember that Revolut isn’t considered an official bank or neo-bank in Australia. It is licensed by the ADI, so its operations are legal and regulated. However, the local transfers are processed by a bank that the service chooses not to disclose. If you’re interested in Revolut for local transactions in Australia, this is probably not the best choice. But when it comes to international operations, this service is worth looking into.