Revolut has entered Britain’s unsecured personal-loans market, putting the digital bank in direct competition with the country’s established high-street lenders as it seeks to deepen relationships with its 14 million UK customers.

The company said on Monday that loans would initially be offered to a selected group of customers before being rolled out more widely in the coming months. Borrowing will range from £2,000 to £25,000, with advertised interest rates between 6.9% and 29.3%.

Digital challenger takes aim at banks

The launch marks a significant expansion of Revolut’s UK offering. The company has built its customer base around payments, foreign exchange, current accounts and savings, but personal lending offers a potentially important source of revenue and a way to increase the amount of financial activity conducted through its app.

Revolut’s UK chief executive, Francesca Carlesi, told Reuters that the lender would adopt a cautious approach at launch. The staged rollout is intended to allow the company to assess demand and credit performance before making the product available across its customer base.

Personal loans are a large and competitive market in Britain, traditionally dominated by banks with established credit histories, extensive branch networks and long-standing customer relationships. Revolut’s data-led model could allow it to make rapid lending decisions and target offers directly through its mobile platform.

Risks as borrowing costs remain under scrutiny

The move also comes as households remain sensitive to the cost of borrowing. UK consumer confidence fell sharply in October, with GfK reporting an 11-point monthly decline in its index to minus 24, while consumers’ expectations for inflation increased.

That backdrop could support demand from customers seeking to manage major purchases or household finances, but it also raises the risk of weaker repayment capacity if living costs remain elevated. Revolut’s broad interest-rate range reflects the different levels of risk associated with individual borrowers.

Consumer credit is closely scrutinised by regulators, particularly where lenders use automated assessments and market products to large digital customer bases. A controlled launch gives Revolut an opportunity to refine underwriting and monitor customer outcomes before expanding the service.

Part of a broader growth strategy

The lending launch is the latest step in Revolut’s effort to become a fuller-service financial institution rather than a payments-focused app. Personal loans can generate interest income while helping the company cross-sell savings, cards and other services.

The company’s expansion comes as investors and policymakers focus on competition in UK financial services. Digital banks have gained market share by offering fast account opening, transparent app-based services and products aimed at customers who want an alternative to traditional lenders.

For established banks, Revolut’s move adds pressure to defend profitable consumer businesses while maintaining careful control of credit quality. The challenger’s eventual impact will depend on how widely it extends lending, how competitively it prices loans and whether its existing customers are willing to consolidate more of their finances on the platform.

What happens next

Revolut plans to broaden access to the loans over the coming months, moving from an initial selected group towards its wider UK customer base. The rollout will provide an early test of whether its digital distribution model can translate into meaningful scale in mainstream consumer lending.

Success would strengthen Revolut’s position as one of the most formidable challengers to Britain’s banks. Failure to manage credit risk or customer affordability, however, could expose the company to the same pressures that have long shaped the lending strategies of traditional financial institutions.