Revolut breaks into New Zealand's saturated banking market with instant savings

New Zealanders gain access to a new banking option as Revolut receives its first fully digital banking registration. The Reserve Bank approved the license on Tuesday, allowing the company to offer instant-access savings accounts to personal and business customers. These accounts fall under the national Depositor Compensation Scheme, providing the same protection as traditional high street banks.

The company has operated in the country as a financial services firm since 2023. It now joins a market dominated by four Australian-owned institutions that hold over 80% of the local banking share. Revolut plans to invest 120 million New Zealand dollars in its New Zealand operations. The firm reports 80 million customers globally and holds a valuation of 115 billion US dollars, or 204 billion New Zealand dollars, following its latest funding round.

Scott McKinnon, the Reserve Bank's director of specialist supervision, stated that the regulator recognizes the value credible new entrants bring to a competitive and efficient financial system. He noted that Revolut met the required standard for bank registration.

Nik Storonsky, the founder and chief executive of Revolut, described the approval as a significant step toward becoming the world's largest digital bank. He called it the company's seventh bank license and its fifth this year. Storonsky expressed confidence that the new offering will bring true competition to the sector.

S&P Global has assigned Revolut an investment-grade BBB+ long-term credit rating with a positive outlook. The bank will now function as the 27th registered bank in New Zealand.

The company aims to challenge the incumbent banks with a seamless and secure digital experience. The license allows it to expand its services beyond its previous financial services role in the country.