Bank challenger Revolut has launched a new paid-for account, as fintech firms seek new ways to make money during the pandemic.
Revolut said on Wednesday it was launching a new “Plus” account, priced at £2.99-a-month. The account sits alongside its more expensive Premium and Metal card offerings.
Plus customers will get extended refunds on eligible items, purchase protection coverage up to £1,000, and priority customer service, among other benefits.
“We’re excited to launch our upgraded plans for our customers across Europe, providing them with great value for money while protecting them from out of pocket expenses,” Revolut founder and chief executive Nikolay Storonsky said in a statement.
“We want to help our customers shop safely, knowing their purchases are protected by Revolut from theft, damage, or no-returns policies.”
The launch of Revolut Plus comes as many fintech challenger brands seek ways to diversify revenue and turn a profit after being battered by the pandemic.
READ MORE: Monzo re-launches £5-a-month 'Plus' account
Revolut and rival Monzo made a significant amount of revenue through interchange fees — tiny charges levied every time someone makes a transaction using their debit card. These businesses also benefited from customers spending on their cards abroad. The collapse of in-person retailing and travel bans have hammered both these revenue streams.
“As we have seen during 2020 with the global response to the COVID-19 pandemic, restrictions on customers’ ability to undertake travel and other expenditure can negatively impact on the ability of Revolut to generate revenue,” management wrote in annual accounts filed in August.
Earlier this year, Monzo was forced to lay off staff and suffered a big write-down in its value. In July, the company warned it was fighting for survival. The bank has launched several paid for products since then, including a Monzo Plus account.
Founded in 2015 as a foreign exchange app and card, Revolut has over 13m customers around the world. The startup already had paid-for offerings prior to the pandemic and was less reliant on interchange fees that its rival. In prior years, the company had diversified into things like cryptocurrency and stock trading.
“We think Plus will be an attractive and popular addition,” said Felix Jamestin, head of premium product at Revolut.
Revolut cut around 60 staff at the start of the pandemic, Financial News reported in May. The company lost £106.5m last year on revenues of £162.7m.
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