Revolut eyes Australia's mortgage market after securing banking licence

Revolut, the London-based fintech that has spent the last decade chipping away at traditional banking across Europe, just won its first foothold in the Asia-Pacific region. Last month, Australian regulators handed the company a banking licence—a credential that opens doors the startup could not kick down before. Now, with that licence in hand, the company's Australian chief executive, Matt Baxby, is eyeing the country's mortgage market, where the real money sits and where the Big Four banks have built a fortress.

Australia's banking landscape is dominated by four institutions—Commonwealth Bank, Westpac, National Australia Bank, and ANZ—that control at least 70 percent of all deposits and lending, including mortgages. It is a market so concentrated that even Macquarie, one of the country's largest investment banks, had to fight hard just to become the fifth-largest home lender. Into this terrain, Revolut is now stepping. The company already has 1.2 million Australian customers who came to the platform for currency exchange and international payments. Those customers, Baxby believes, are the foundation on which to build something larger.

Revolut's Australian operation is not starting from zero. Since launching savings accounts and credit cards after receiving its licence, the company has been operating on a subscription model—customers pay between A$5.99 and A$99.99 per month for tiered access to better interest rates, reduced fees, and other perks. This pricing structure is unusual in Australia, where most banks offer free accounts, but it reflects Revolut's global playbook. The numbers suggest it is working. In 2025, Revolut Australia generated A$70.8 million in revenue, a 74 percent jump from the year before. More tellingly, the operation is already profitable, posting a net profit of A$7.4 million. That profitability comes not from lending yet, but from the bread-and-butter services Revolut knows well: foreign exchange transactions and interchange fees—the small payments merchants' banks hand over every time a customer swipes a card.

Baxby frames the move into mortgages as inevitable. "It's almost a natural progression that you move into more of those relationship-based products," he told Reuters. "That's a massive pool in Australia and also pretty heavily contested." The mortgage market is where the Big Four make their money and where they have built customer loyalty. But it is also where they are most vulnerable to a competitor that can undercut them on rates or offer a frictionless digital experience. Baxby is betting that Revolut's existing customer base, combined with its technology infrastructure and the group's global resources, gives it an edge that previous challengers lacked.

That confidence is not unfounded, at least on paper. UBS banking analyst John Storey noted that Revolut presents a more credible threat than most neobanks that have tried to crack Australia before. The company's model is deposit-led—it is building a base of customer savings that it can lend out—and it is technology-heavy, meaning it can scale without the branch networks that weigh down traditional banks. But Storey also cautioned that the near-term earnings risk to the Big Four remains limited. Revolut's success will hinge on whether it can attract and retain customers, keep them engaged with the app, and grow its deposit base.

History offers a cautionary tale. Two Australian neobanks, Xinja and Volt, shut down in 2020 and 2022, respectively, after failing to gain traction against the incumbents. Xinja's collapse was particularly instructive: the bank offered high deposit rates to lure customers but did not launch lending products fast enough to offset the costs of acquiring those deposits. Joshua Koh, a partner at the consulting firm Simon-Kucher, points out that Australian banking customers have historically shown little appetite for switching away from the Big Four. "People use neobanks for very specific reasons, typically the high interest rate that they offer," he said. Once those rates normalize or the novelty wears off, customers drift back to the familiar names they trust for everyday banking.

Revolut's path forward depends on speed and scale. The company is expanding rapidly—it now operates in 40 countries and is planning to launch in India as part of a push to reach 100 million customers by mid-2027. Its recent secondary share sale valued the company at around $115 billion, making it worth more on paper than European banking institutions like Barclays and Societe Generale. But valuation and market dominance are different things. In Australia, Revolut will need to move quickly into mortgages, build a lending book, and convince customers that a European fintech can be trusted with the largest financial commitment of their lives. The Big Four are not sitting still, and they have the advantage of incumbency, branch networks, and decades of customer relationships. What Revolut has is technology, capital, and a global playbook. Whether that is enough remains to be seen.