Fintech Revolut is creating 50 new jobs in the Republic of Ireland as it moves its European payments operation from London.
The London-headquartered fintech challenger bank’s UK payments operations will remain in the UK capital.
According to a report in The Telegraph, the company is making the changes as EU passporting rights, which allow EU banks to serve customers across the trading block, could end for UK banks. With uncertainty caused by Brexit and increasing consumer demand, Revolut will hire up to 50 staff in Ireland this year to serve its Western Europe business customers.
Revolut chief operating officer Richard Davies told The Telegraph that the initial reason for the move was Brexit. “The strategy is to have our central and eastern European clients on our Lithuanian EMI and bank licence,” he said. “For our western Europe clients, we are in the process with the Central Bank of Ireland around authorising there to have western European clients on our Irish licence.”
While there is often talk of Paris attracting UK firms, Ireland has announced success in creating thousands of new jobs since the UK referendum on its EU membership. IDA Ireland, which is responsible for attracting foreign investment to Ireland, has announced that companies within its remit added thousands of jobs.
These include firms such as Morgan Stanley, Bank of America Merrill Lynch and Barclays, which all expanded in Ireland as part of their Brexit planning. In 2018, IDA Ireland told Computer Weekly: “Financial services is the most high-profile industry to be affected by Brexit because the re-regulation of banks and financial businesses takes so long,” he said.
“They don’t have time to wait and see what the Brexit agreement between the UK and the EU is going to be.”
Read more about Brexit’s impact on UK fintech
Revolut is not the only fintech planning for a post-Brexit operation. In November, UK fintech Azimo launched its Dutch subsidiary, which was inspired to shield the money transfer company from the damaging effects of Brexit.
The cross-border money transfer fintech started looking for a location for its European operation after the UK referendum result in June 2016. All cross border transfers made from outside the UK will now go through Azimo’s Amsterdam-based operation.
The company was attracted by a welcoming culture which is open to innovation, access to talent, a thriving banking sector and a strong regulator.
Richard Ambrose, CEO of Azimo, said: “It also guarantees that we can continue to benefit from EU passporting rights to offer our service across Europe.”
But not all fintechs are as prepared. According to a survey from fintech industry organisation Innovate Finance, published in September 2019, more than three-quarters (78%) of UK fintechs are inadequately prepared for the ramifications of a no-deal Brexit, and 45% don’t feel prepared if there is a transition period, which is where we are now.
The findings from the survey also revealed that 17% of respondents are considering moving to a different jurisdiction as a result of Brexit.
The main concerns were around passporting rights –which currently allow EU banks to serve customers across the trading bloc – cross-border transactions and access to talent.