Revolut steps up competition with traditional banks by launching its own credit card. Each customer will have their own affordability limit based on the company's credit evaluation
Revolut says applying for a credit card will be a simple process with immediate approval for those who qualify. The move by the online bank, which claims to have two million customers in Ireland, represents a new competitor in the credit card market for the first time in years.
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Revolut credit cards have no over-limit fees and no return payment fees.
The card offers 1pc cashback of up to €30 on purchases for the first three months. After that, 0.1 percent of purchases will earn unlimited cash back. Customers with a Metal account will get an extra 0.1pc cashback and 1pc cashback outside the EU, the company said. There will also be 0pc purchase and balance transfer introductory charges.
It comes after Revolt recently launched a loan product that has the lowest interest rates in the Irish market for loans under €20,000.
Revolut recently launched a "buy now, pay later" service called PayLater. Last month, Revolut announced that its customers would receive Irish bank identification IBAN numbers in a move that would make it easier for people to do their everyday banking through the Money app.
Revolut's move to replace Lithuanian IBAN international bank account numbers with Irish will put more pressure on mainstream banks here. It has established an Irish branch of European business Revolut Bank UAB.
Revolut said the credit card will offer 0pc balance transfers for the first three months. The bank claimed that applying for the Revolut credit card will be a simple process with immediate approval for those who qualify. No interest for the first three months as long as the user makes monthly minimum payments. After that, the annual percentage rate is a competitive 17.99 percent.
Revolut claimed the new credit cards would offer a responsible way to use credit, with a big emphasis on consumer affordability. Revolut checks customer affordability by linking to customers' existing bank accounts through Open Banking. Current credit limits range from €500 to €10,000, but each customer will have their own affordable limit determined by Revolut's credit assessment.
Joe Heneghan, Chief Executive of Revolut Europe, said: “We have developed the technology to offer credit cards with suitable limits at affordable rates to authorized customers, so they can get the credit they need, when they need it.
Revolut is popular because its app can pay another person or business in minutes, while its app is easy to use. Until now, the lack of an IBAN for an Irish bank number has made it more difficult for people to use Revolut as a main current account. Many people have a Revolut account in addition to a current account at a mainstream bank.
A Revolut account with an Irish IBAN is more suitable to use as a primary account for receiving salaries directly into Revolut, making payments by direct debit and paying utility providers directly from your Revolut account, the company said. It will also make it very easy for customers to switch their bank accounts from traditional banks to Revolut.
Offering credit cards, loans, buy and pay later and Irish IBANs means Revolut is an even bigger threat to mainstream banks AIB, Bank of Ireland and Permanent TSB.
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