Below are comments compiled from an interview with Tamas Leder, country general manager for fintech company Revolut in Hungary, which appeared on the Hungarian business news portal Portfolio.
Some 5 percent of Hungary’s population of 10 million are Revolut customers, a share that is only higher (within the EU) in Ireland and Romania.
When Leder joined Revolut in 2021, the company had 400,000 customers in Hungary. This figure has since quadrupled, and he hopes to hit 2 million customers in Hungary next year.
This year, Revolut has launched various products aimed at helping people save money, including a flexible money market fund and a regular savings account. However, the primary driver of activity is still payment traffic. Customers are particularly drawn to there being no transaction fee with Revolut, as the company instead takes this on as a net cost.
However, Portfolio notes that an additional fee will apply to currency exchanges starting Oct. 1. Leder says not all details are yet clear regarding the rule change but is fairly certain the tax will not be passed on to customers in the beginning. As to the longer term, he cannot say.
In terms of currency exchange costs, due to market competition, most banks are now offering market rates, eliminating what used to be a large spread. Leder says this is great news for all customers and great that no external, regulatory intervention was needed.
The biggest news for Hungarians is Revolut’s plans to open a bank branch in Hungary. What does this mean for an e-bank? In 2022, Leder says the company shifted from being an e-money service provider to a banking service provider, in line with its strategic goal of becoming a universal bank.
Revolut already has branches in France, Ireland, the Netherlands, and Spain, with a pilot launched in Germany.
Hungary is also one of the core markets targeted for a local branch, Leder says, explaining that this is different than a subsidiary bank.
Customers are currently protected by the Lithuanian deposit insurance system, he says. The Hungarian and Lithuanian deposit insurance systems are both EU, there are no major differences. Revolut has also been under the supervision of the European Central Bank since 2024, Leder stresses.
Under a local branch, local teams will be able to create local products tailored to local needs instead of global products. Customers will also be able to have a local bank account number and IBAN through the branch, meaning they can then use Revolut as their primary bank.
Leder explains the importance of this, as presently many Hungarian customers request their salaries be sent to their Revolut account. However, this is now difficult, as the transfer first goes to a Lithuanian bank account and has a turnaround time of up to a couple of days. There may also be costs that the employer either accepts or does not.
A Hungarian account number solves this problem in one fell swoop, Leder says.
Many customers also have their salary sent to their traditional bank account, but then immediately transfer it to their Revolut account. Some people only transfer as much as they want to spend in the month, while others transfer their entire salary, maintaining some for savings as well.
As to providing services in Hungarian, Leder says that is also in the works, noting that the company has plans to provide customer service in the local language in all our countries. However, thus far, Revolut customers know services are in English and typically do not have a problem with this.
Revolut reported a 95 percent increase in revenues in 2023 to $2.2bn from $1.1bn in 2022 and a net profit of $428 million. The company states that 70 percent of its customers globally are obtained organically or are referred by someone they know.
