Revolut: Are the accounts of French residents at risk from fraudsters?

There are reports today (December 5) of some users of the online financial service Revolut in the UK being upset to find out it does not offer full ‘bank’ guarantees in the case of fraud – this may not be the case if you use the service in France.

The BBC reports several cases where Revolut did not refund customers when they were victims of financial fraud.

It claims this is because, despite being founded in the UK, Revolut is not a full ‘bank’ in the country and therefore is not signed up to a UK banking code that aims to reimburse customers who are victims of fraud. Revolut reportedly said it will look at situations case by case but does not offer a general guarantee.

This is due to the fact that the firm in the UK is only an ‘electronic money institution’, a financial firm offering similar services to a bank but not with full banking status and not offering credit.

Following the Brexit vote, Revolut also obtained this status in Lithuania, and its customers living across the EU were formerly registered there with a Lithuanian Iban (international code identifying accounts).

However earlier this year Revolut obtained full banking status in Lithuania, known in French as being an établissement de crédit. More recently it has also offered French-based customers the option to swap to a French banking subsidiary and therefore to have a French bank account with a French Iban address. Benefits of the latter include not having to declare an ‘overseas’ account in your tax return.

Anyone who did accept this swap – which is still freely available – would benefit from the usual rules in France on account fraud, which allow for reimbursement subject to certain conditions.

Notably, wrongful use of your card details should usually be compensated by a French bank if reported in up to 13 months; ‘phishing’ scams where someone has obtained your bank details via a scam email, for example, are also usually compensated, unless the bank can show evidence that you were ‘negligent’.

[Edit: Revolut has since confirmed to The Connexion that whether in France or Lithuania the accounts are 'full' bank accounts. The firm added that the same rules against scams would apply whether your account is based in France or in Lithuania.]

The fact of having an electronic money institution account rather than a bank account also means the protection of money in an account in the case of a firm going bust is not guaranteed in the same EU-standardised way, as we explained in this previous article.

Edited December 20 with extra information on accounts in Lithuania

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