MAGGIE PAGANO: Don’t let companies bully Britain

What should we think of Revolut CEO Nik Storonsky’s latest outburst?

In recent days, the co-founder of the fintech group has attacked Britain as a lousy place to do business, chiding regulators for taking too long to give him a banking license, and complaining about high taxes , bureaucracy and skills shortages. .

His last effort was to say that he would not consider floating in the London markets, but would go to New York instead.

Storonsky’s attack is cleverly timed. It comes at a sensitive time for Rishi Sunak and Jeremy Hunt, who have done everything they can to promote the UK as one of the world’s leading technology hubs.

Just a few months ago, the Chancellor named Revolut as a “shining example from our world’s fintech sector” during a speech urging tech bosses to help make the country “the next Silicon Valley.”

City regulators are so concerned about the number of British companies choosing to go to the US that they’ve introduced new listing rules to make it more attractive for them to float in London’s public markets and not jump to New York.

So you can understand why Storonsky’s caustic criticism is causing such a stir in Westminster.

But there may be another reason why Storonsky’s timing is interesting: His outburst comes as the group of payment apps is due to hear the results of their application to get a banking license from the Financial Conduct Authority and the Prudential Regulation Authority any minute now.

If so, then it’s a bizarre time for Revolut to attack the authorities. Surely he’d rather talk to them than play the rottweiler? Maybe he knows something we don’t.

Could it be that Revolut fears not getting a license? That would come as no great surprise: BDO’s auditor warned in March that parts of the long-deferred accounts may contain ‘material misstatements’.

BDO reported that much of the fintech’s 2021 revenue – £477m out of £636m – may have been misreported due to the design of its IT systems, thus failing to provide ‘sufficient appropriate assurance’ about revenue streams from foreign exchange to crypto trading. Pretty devastating.

However, Revolut lashed out at media coverage of the report, claiming that the BDO audit “confirmed that the financial statements give a true and fair view” of its books.

Questions have also been raised about the high valuation. After a 2021 funding round, it boasted it was worth £27bn, even though it was only just turning a profit. Last month, Schroders cut its value to £14bn, and like many other investors, it has written off its stake by about half.

If Revolut fears it won’t get a license, this attack looks like a last-minute hard-hitting lobbying tactic.

Or sour grapes. Storonsky is ramping up the pressure on politicians at a time when he knows how eager they are to improve the business climate and open up to innovative, tech-savvy companies like Revolut.

Yet neither they nor the regulators should be tempted by the PR machine at work. They have to keep their nerves in check.

It is much more important to the reputation of London, and the UK, that all companies applying for a banking license should be subject to forensic due diligence and only be granted to reputable companies.