London-based challenger bank
On Thursday, Revolut announced the launch of a robo-advisor for U.S. investors. The service, which the company says carries an annual fee of 0.25% with a monthly minimum of 25 cents, is being billed as a cost-effective way for its customers to create investment portfolios.
Revolut says the robo-advisor will take user responses and provide them the opportunity to invest in one of five portfolios based on their risk tolerance. Once a customer deposits money into their portfolio, Revolut's robo invests it in the market, monitors its performance and manages the user's portfolio.
Revolut says the automated investor rebalances the portfolio automatically to stay in sync with the customer's risk tolerance determined at onboarding.
Jack Callahan, Revolut's U.S. head of wealth and trading, said the company is excited to add a robo-advisor to its suite of wealth and investment products and services.
"We know that many of our customers do not have the time to manage a portfolio or invest in individual securities. Built to make investing more accessible, we want to give our customers the ability to make their money work for them in what we believe will be a tailored and stress-free way," Callahan said in a statement.
Founded in 2015, Revolut provides a wide array of services. The company offers remittances, checking and savings accounts, cryptocurrency trading, investing and the ability to use airport lounges when a flight is delayed, among other things.
In November 2022, the fintech reported having more than 25 million retail customers, marking 25% growth since July 2022. Officials also said Revolut customers initiate more than 330 million transactions each month.
International expansion was noted as a top priority for company leaders in late 2022. The challenger bank has built a team of more than 400 employees in India and plans to grow a workforce of more than 250 between Mexico and Brazil.
Revolut's presence in the United States, where it launched in 2020, includes about a half million retail customers and more than 150 employees.
But there have been challenges at home as Revolut pursues growth outside of Europe. Bloomberg reports that Revolut applied for its U.K. banking license in January 2021 but has faced a number of obstacles including concerns around its accounts.
Auditors have said they were unable to satisfy themselves on the "completeness and occurrence" of almost three-quarters of Revolut's revenue.
In March, when Revolut reported its delayed results, former Revolut Chief Financial Officer Mikko Salovaara said the company was "nearly there" with gaining its license, which would allow it to take customer deposits.
But the process has dragged on, motivating the firm's founders to criticize the U.K. as "not the business environment to operate in the modern world."
In May, Salovaara left the company "for personal reasons" after two years in the job, Bloomberg reports.
Revolut was Europe's most valuable startup when it raised $800 million at a $33 billion valuation in mid-2021 before the startup world hit a snag and investor support dried up. In the latest sign of caution, an investment trust managed by Schroders said in April that it slashed the value of its small stake in Revolut by 46%.
