The UK’s most valuable fintech Revolut has been fined €3.5m by the Lithuania central bank over failures in its money laundering prevention measures.
The bank confirmed that Revolut had been fined last Monday after it found “violations and shortcomings in the monitoring of business relationships and operations”.
Despite Revolut stating it found no signs of any confirmed cases of money laundering by its Lithuanian customers, the digital bank settled with the central bank and vowed to resolve any shortcomings in its anti-money laundering controls.
According to the Lithuanian central bank, Revolut “led to not always properly identifying suspicious monetary operations or transactions”, which it claimed Revolut did not outline in detail to the central bank.
The fine, lodged to Revolut Holdings Europe – the European Economic Area entity of Revolut – became the largest fine of its kind issued by the Lithuanian central bank.
Revolut operates in Lithuania as an e-money institution under Revolut Payments UAB through the use of an IBAN. Lithuania customers can use Revolut to send cross-border payments to and from Lithuania wherever payments are settled in the SEPA zone.
Despite being one of the smaller European countries per population (2.872 million: 2023), Lithuania is one of the highest-growing fintech countries not just in Europe, but the world.
A 2021 Findexable report ranked Lithuania as the 10th best performing fintech sector in the world, which was higher than largescale countries such as Canada (12th), Brazil (14th) and China (15th).
Recognising Lithuania’s presence as a hotbed for fintech growth and innovation, Revolut secured a banking licence from the country’s central bank towards the end of 2021, merging its Revolut Payments UAB and Revolut Bank UAB subsidiaries into a fully operational entity.
Although Revolut has enjoyed success in Lithuania, with its money transfer services to its almost 600,000 customers, the €3.5m fine will deal a slight blow to a company that has enjoyed a new wave of momentum over the last year.
After finally securing a UK banking licence last year, the digital bank became Europe’s most valuable fintech after a secondary share sale lifted its valuation to now over €45bn.
The fine in Lithuania, however, will do little to quell the pre-existing concerns placed against fintechs like Revolut when it pertains to security measures against their traditional banking counterparts.
