Revolut, one of Europe’s most recognisable fintechs, is facing an investigation launched by the Italian Competition Authority (AGCM). It is about suspected misleading customers about the investment and banking services offered by the app.
The regulator’s concerns include the promotion of investments in shares without commission, without a clear indication of hidden costs or restrictions. Particularly controversial was the offer of fractional shares – a cheaper alternative to full shares – but which do not offer the same voting rights or transferability.
AGCM also accuses Revolut of a lack of transparency when trading cryptocurrencies – users were not properly informed about the inability to change stop-loss and take-profit settings, which help mitigate investment risk.
The case also relates to account blocking procedures. According to the AGCM’s announcement, Revolut was alleged to have suspended access to funds without warning and without effectively assisting customers – leading in some cases to users being cut off from their money for long periods of time.
Although Revolut has pledged to fully cooperate with the regulator, the investigation could impinge on its plans for further expansion. The company, recently valued at $45bn, is looking to enter the mortgage and consumer lending markets and consolidate in the US.
Italian legislation provides for fines of up to €10 million for violations of consumer rights. So for Revolut, the stakes are not only financial but also reputational – especially in a market where trust in digital banks still needs to be built.
In a statement sent to our editorial office, Revolut assures of its cooperation with the Italian authority: “We take the concerns raised by the Italian authority Autorità Garante della Concorrenza e del Mercato extremely seriously. We assure you of our full past and future cooperation with the office. As the case is ongoing and the doubts are being clarified, we cannot comment on the details of the proceedings at this time. Revolut is fully committed to maintaining the highest standards of compliance and customer protection in Italy and around the world.”
The article was supplemented by an official statement from Revolut.
