Revolut: the ‘bank challenger’ problems threaten to disrupt customers’ trust
Revolut – an ambitious fintech startup aimed to become a flexible alternative to traditional banking cards, is going through really tough time now.
The daring motto of the company “Get Shit Done” has recently lost S and H letters, meaning playtime is over. The multi-billion innovative project that started so great back in 2015 is facing serious challenges: Revolut top managers committed several major mistakes that may cost dear.
First, there was this ill-designed Valentine Day ad campaign that offended many users with ‘patronising language’ and ‘single-shaming’. Besides, the phrases like “The 12,750 people who ordered a single takeaway on Valentine’s Day – you ok, huh?’ made clients suspect Revolut had been tracking their shopping activities, putting this data to good use. Later it became known that the statistics used in the ads was fake; nevertheless, the situation left many customers angry and reduced their loyalty to the app.
Second, Revolut was accused of having toxic corporate culture and using controversial recruiting practices to acquire more customers. The impressive growth of the company’s client base was partly due to the test task offered to potential employees. They had to recruit minimum 200 new clients per week, even if their position was not directly connected with customer acquisition.
Also, the ‘digital challenger’ allowed multiple illegal transactions to pass through the system, thus failing to comply with money laundering regulations. The automated system that had to block suspicious transactions was deliberately switched off for several months because it also blocked many legitimate transactions, causing a lot of discontent on the client’s side. Instead, Revolut opted for a screening process that was not enough to filter off thousands of illegal transactions.
As a result, the CFO of Revolut Peter O’Higgins had to resign in January (though the company denies this decision was directly connected with the compliance issue). The CEO, Nikolay Storonsky, insists that the company did not mean to break the rules, but admitted that they had not notified FCA about the issue, as they were supposed to.
Another problem Revolut has to deal with since March is many angry users who have their accounts blocked for no reason, or cannot log in. The customer support is slow to respond, or does not respond at all, according to many reviews. The company’s tweet admitting ‘some technical issues, affecting the app functionality’ did not make things easier for those unable to use their funds.
Currently, Revolut is taking measures to clean up its somewhat tarnished rep. Recently, it has been hiring a few high-profile banking veterans, including Michael Sherwood, and trying to make the corporate image less challenging and aggressive. They also plan to hire more compliance specialists and improve customer service by adding a phone support option.
Currently, many fintech startups, also seeking to disrupt the traditional banking system, are closely monitoring the situation. They are worried their reputation might be negatively affected by it, too.
Hopefully, the guys from Revolut manage to get **it done properly.