How Technology Has Changed… Banking. Interviu cu Irina Scarlat – Revolut

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Finetech is an English term for financial technology. It is, in fact, a sub-domain that uses the integration of hi-tech solutions to reform the financial system.

Although the term makes you think of something new, its beginnings date back to the 1800s, when banks used the telegraph to authorize payments. If you are passionate about this topic, I recommend you access this link. There you have all kinds of complete and complex explanations about finetech.

For today's Europe, there is no other institution that better defines this term than Revolut. On our blog we developed the subject quite a bit and we told you about our experiences with their services or with situations in which they were involved. You can find the article archive here. Also, for a detailed analysis of what Revolut means on the financial market, you can access the report here.
 

Since June, last year, Irina Scarlat has been the Head of Growth - CEE. Previously, she was Project Manager European Growth Machine and Country Manager, starting with May 2018. Before working for Revolut, Irina was also Marketing Manager and Lead Marketing Manager at Uber Romania. If we look further into her resume, we see that she has experience in the field of tech start-ups.

arenait.ro: Hello, Irina. If we look at your CV we see Uber and Revolut, that is, the companies that set out to be the disruptive elements in conservative markets. How did the traditional players - the taxi companies and the banks - receive and look at you?

Irina Scarlat: Uber and Revolut are really two innovative companies that have revolutionized traditional industries. However, the reaction of traditional market players was significantly different. If in the case of Uber most taxi companies opposed the entry of Uber on the market, in the case of Revolut, at least in Romania, the banks welcomed the entry of Revolut on the market intensifying digitalization efforts and launching new products and services to better meet customer needs. Competition is always a good thing, both for end users, who have the opportunity to choose the service that best solves their problems, and for market players, who need to constantly innovate and communicate transparently with their customers in order to maintain its market position.

ait: In another interview, you said that you chose the current employer because it is “the next big thing in finance”, because you want to play an active role in the development of the service and be part of the revolution of the financial-banking system. A year and a half after the statement, is she still standing?

IS: Definitely 🙂 I joined the Revolut team almost 2 years ago because I was convinced that Revolut is "the next big thing in finance". At that time there were about 20,000 users in Romania. Today we are fast approaching one million users. I think that the way I evolved in the last 2 years, the products I launched, the fact that I had an exponential growth, confirms that my statement remains valid today, 2 years later, the difference being that Revolut is today " the current & next big thing in finance ”

ait: The banking field seems, from the outside, a conservative one. When you enter a bank, you see people dressed in business clothes, carrying all kinds of papers from one place to another and asking for your signature for any transaction. How does Revolut fit into this landscape?

IS: It does not fit into this landscape 🙂 Revolut is very different from the things we are used to in this landscape. First of all, Revolut is a company that uses state-of-the-art technology to provide the best financial services on the market. Users can create a simple account in just a few minutes without going to a branch office, and they can perform multiple financial transactions with the push of a button. Basically, they can organize their entire financial activity with the help of the phone, efficiently, simply, quickly. No bureaucracy, no unnecessary roads, no branches and no business people, most of the time 🙂

ait: What does a day look like in the offices of Revolut Romania?

IS: Every day is different. Sometimes I am caught all day in meetings and meetings, other times I work with the team on different projects. I am also very involved in the recruitment process and in the formation of growth teams in Europe and in the markets where we plan to expand. Therefore, it is difficult to say that there is a typical day in the office of Revolut Romania.

We are very flexible in many ways. You can work from the office or from any other place, as long as you are efficient and perform your tasks successfully. The work schedule is also flexible - we don't have a typical 9-17 schedule and it doesn't matter to anyone how many hours you worked each day, as long as you do your job.

ait: All banks offer newer online banking services and lower fees. What else does Revolut bring to attract customers?

IS: At the risk of sounding very modest, I can confidently say that Revolut is without a doubt the best financial product on the market right now. Users can open accounts in 30 currencies, make instant payments, spend money anywhere in the world on an excellent exchange rate, and benefit from budgeting options; can invest the money in shares of over 300 companies listed on the New York Stock Exchange and NASDAQ; they can take out travel or telephone insurance and have access to lounges at airports around the world. Basically, Revolut becomes the application through which you can manage your entire financial life. No other service on the market currently offers all this. And everything happens without hidden fees and commissions.

In addition, our vision is to become the world's first truly global bank. Although some banks offer online banking services and do not charge fees and commissions in Romania, the situation changes significantly when customers cross the country's borders. We differentiate ourselves by providing services to today's global citizens, who travel frequently, shop online, and spend money in various currencies in their day-to-day business.

ait: What is the profile of your clients: age, occupation, amounts traded, etc?

IS: The average age of the Revolut user is 34 years, which is higher than when I entered the market - initially, this age was 32 years. There are people mostly from urban areas, with medium and high incomes, smartphone owners, in an approximately equal share of women and men.

ait: In which cities do you have the most customers?

IS: Bucharest, Cluj-Napoca, Iasi and Timisoara.

ait: One of the most successful campaigns you had was the one related to the 50 RON received by users for each new customer they took. Do you have a statistic with the number of customers attracted? How many of them are still active?

IS: It was a very successful campaign, but unfortunately we can't give any data on it.

ait: Romania is a relatively conservative market, which hardly accepts innovation. How do you persuade your customers to trade their money through a non-bank company that operates exclusively online and is not controlled by domestic authorities?

IS: Romanians have more and more confidence in Revolut, and the fact that in less than two years we have grown on the local market from 20,000 users to almost 1 million is a confirmation of this. The increase is largely due to the fact that users are delighted with the product and recommend it to family and loved ones, who in turn create accounts and use the app. We have gained the trust of users by providing them with a quality service that solves their problems and helps them save time and money and manage their finances simpler, faster, more efficiently.

We also have the advantage that there is no real competition in the domestic market for the services we offer, Romania is outside the EUR area, and Revolut is without a doubt the best financial product available at the moment.

As regards the legal framework, Revolut holds a license for electronic money issued by the Financial Conduct Authority of the United Kingdom. As the license is obtained in one of the Member States of the European Union, it is passported throughout the European Economic Area (EEA). Therefore, Revolut strictly complies with European regulations, which also apply to Romania, given that we are part of the EU.

ait: In addition to the nice things about you, you also had some problems, such as those related to money laundering charges and possible links with the Russian mafia. How do you comment on the situation?

IS: The money laundering allegations turned out to be false, and the Financial Times, where these allegations originally appeared, withdrew its article shortly after publication. As for the links with the Russian mafia, these are mere speculations and there is no evidence to support them.

ait: There have been cases in which the amounts paid by certain clients have been doubled. How did you manage to avoid situations in the future?

IS: A small number of users were affected by this last summer due to the fact that one of our partners had a payment processing issue. We worked with our partner to resolve the situation quickly, and the money was returned to the affected users' accounts shortly. Following this experience, our partners have taken additional steps to verify and process transactions, but we are unable to provide further details. What is certain is that we work closely with all our partners so that such situations are avoided in the future.

ait: There are many complaints in the online environment that users have found their accounts or transactions blocked abusively. How do you decide when to take such action?

IS: Revolut does not block user accounts or transactions abusively. We are a financial institution and we are subject to strict regulations regarding the prevention and combating of money laundering. Our security systems constantly monitor all accounts to ensure that our users are safe and protected from fraud. When systems identify suspicious activity, the account may be temporarily blocked. This measure is a regulatory requirement to keep accounts secure.

To unlock the account, the user must provide documents proving that the source of funds is a legitimate one (salary slips, contracts or any other documents that show that he is the beneficiary of dividends, sale-purchase contracts, etc.). These documents are then analyzed by our team specializing in financial crime.

We are aware of the impact that temporary account blocking can have on users, and we are constantly working to quickly unlock these accounts when possible.

ait: Cyber attacks have become more frequent in the banking environment. How does Revolut defend themselves from them?

IS: Security is a priority for Revolut and one of our main responsibilities. Therefore, we have systems that ensure the security of business, products and processes at all times.

Business security means that we always make sure that all employees are extremely responsible for user data. In addition to organizing special training programs every 6 months for employees, we know and monitor exactly what data each employee has access to.

As for the products, they are the safest on the market at the moment

 

ait: As with Tesla, were there any voices denouncing the company's toxic work environment? What is your position on overtime and how do you protect employees from burnout?

IS: All Revolut employees are passionate about what they do, and if they work overtime, they do it out of passion and it is an assumed choice. Nobody at Revolut forces you to work a certain number of hours and, as I said before, we are very flexible both in terms of the schedule and the place from which an employee chooses to work. When those articles came out, I wrote an article that outlines my perspective, from the point of view of a person who worked directly with Nik Storonsky, our founder, and Alan Chang, VP of Operations. Revolut is a dynamic company, things happen very fast, we grow very fast, and our team is made up of very talented people who are passionate about what they do.

ait: Other finetech companies (see case N26) have also started to be successful in our country. How will you cope with the competition?

IS: We were the first company of this type to enter the Romanian market, which is an advantage, and we offer the best product available today. We like competition and we think we need it to get better, but we don't think there is real competition for us right now, at least not locally.

In addition, we focus all our energy on constantly offering the best products to users and we plan new launches, which are unique for the Romanian market.

ait: Last year you became one of the 40 tech companies worth over a billion dollars (the so-called unicorn). What's next?

IS: We have ambitious plans and this year is a very important one for us. After launching in Australia and Singapore last year, we will continue to expand globally in markets such as the USA, Japan, Canada and New Zealand. We plan to launch new revolutionary products, including a service for teenagers. At the local level, we want to launch Romanian IBANs, which means that Romanians will be able to receive their salaries directly in the Revolut account. We also plan to launch a special product for companies.

ait: There are countries where your cards can already be added to Google Pay. Do you know when the service will be available with us?

IS: This depends exclusively on the launch of Google Pay in Romania, which unfortunately does not belong to us, so we do not have information in this regard.

ait: You already offer stock options, travel and telephone insurance, crypto-currency transactions and savings account. Do you have any new services planned?

IS: This year we will launch a product for teenagers, but we will come back with more information at the time of launch. We are also going to bring a product dedicated to companies to Romania, but we cannot yet estimate a date when this will be done.

ait: Another service that is rumored to be introduced is that of opening accounts for teenagers. Traditional banks are reluctant to do so. What made you think that?

IS: Many parents ask us if they can create accounts for their children. We often get this question from teenagers. We strongly believe that there is a need for financial education among young people and we want to be able to contribute to this by launching a product that will help them manage their money efficiently.

ait: If we kept touching on the subject - what do you think about children's access to gadgets and technology? When does it turn from useful to harmful?

IS: Undoubtedly, our children are the truly digital generation. But I strongly believe that we need to differentiate between technology that improves the quality of life and technology for the sake of technology. I do not have a recipe for success here, and my child is very young now, but I intend not to give him access to technology in the first years of life (up to two years), and later he will receive limited access to technology. I think the measure is the key here: we provide access to technology for children, but we need to make sure that they do not become victims of online abuse and that they continue to be anchored in the objective reality around us. I think it's very important to spend quality time with our children, away from the screens, but I don't think a complete ban is a solution.

ait: Unlike the big banks, which currently operate mainly in Europe. What are the development plans for other continents?

IS: We currently operate in Europe as well as in Australia and Singapore, markets we launched last year. Enlargement plans target the United States, Canada, Japan and New Zealand.

ait: The American market is totally different from the European one. How will you cope with this challenge?

IS: Every market I serve