Revolut chief executive Nikolay Storonsky

Credit: Geoff Pugh

Revolut has become Britain’s most valuable fintech firm of all time after it raised $800m (£578m) of funding that makes it worth more than £23bn.

The digital banking business, which now has 16m customers, plans to continue its global expansion including to regions like the US, China and India with the funding.

The fundraising means Revolut, which was founded just six years ago, is now worth about the same as NatWest, one of the UK’s largest mortgage lenders.

New backers of the company include Japanese conglomerate SoftBank’s $30bn second Vision Fund and Tiger Global Management, the prolific New York technology start-up backer.

The Chancellor called Revolut’s raise “great news” and said its expansion will create more jobs in the UK.

Rishi Sunak said: “We want to see even more great British fintech success stories like Revolut, which is why I’ve published a roadmap setting out how we will ensure the UK sector remains competitive, forward-looking, and dynamic."

Nikolay Storonsky, Revolut’s founder and chief executive, told The Telegraph in 2019 that he had held investment talks with SoftBank that year: “They wanted to invest straight away, they asked me would I take money. I said no.”

Revolut was reportedly targeting a valuation between $10bn and $15bn at the start of 2021 but has benefitted from a recent rise in investor interest in banking technology businesses.

The raise positions Revolut as the UK’s largest digital challenger bank, placing it ahead of rivals Monzo and Starling Bank that also offer app-based banking services.

Buy now, pay later lending business Klarna remains Europe’s most valuable financial technology start-up after reaching a $45bn (£32bn) valuation in a $639m funding round in June that was also backed by SoftBank.

Klarna’s major fundraising was reportedly a factor in Revolut’s ability to raise money at a higher valuation as investors warm to European banking businesses.

Revolut’s latest accounts for 2020 show that losses doubled to £201m despite a rise in interest for its cryptocurrency trading service. Revenues at Revolut rose 34pc to £222m in the same period.