UK's Digital finance giant Revolut has officially launched its personal unsecured lending service in Britain, marking a major milestone in its evolution from a fintech app into a direct challenger to traditional high-street banks.

This strategic expansion is powered by Revolut securing its formal UK banking licence, enabling the firm to scale domestic credit operations and lay the groundwork for future mortgage and credit card offerings.

Revolut's new personal loan scheme:

The loans will range from £2,000 to £25,000, with rates of 6.9% to 29.3%, a Revolut spokesperson said.

Without the decades of customer spending and repayment data held by traditional banks, Revolut’s chief executive Carlesi said, the bank has supplemented its underwriting with information purchased from external providers, adding that the company was confident about its credit analysis.

Carlesi said, Revolut will expand lending gradually and does not have a target for its overall lending in Britain.

The bank will eventually look to offload much of its risk via securitization, aiming to keep its loan-to-deposit ratio close to 6%, far lower than other banks.

Revolut also eventually plans to enter the highly competitive market for mortgages in Britain.

The bank’s lending push comes amid persistent cost-of-living challenges in Britain worsened by a soft labour market and rising inflation, which could weigh on borrowers' ability to repay debt.

Revolut will also launch a credit card product in the near future, Carlesi said, part of a broader effort to increase the income it generates from each customer, a metric by which it lags traditional banks.

By stepping into the unsecured consumer credit market, Revolut directly targets established financial powerhouses in UK.

The move pushes Revolut beyond its core payments and subscription products and into a riskier business as it seeks to compete more directly with lenders including NatWest, Lloyds, Barclays, Santander's, UK business and HSBC.

Since its creation, London-based Revolut has grown worldwide to serve more than 80 million customers and commands a private valuation of $115 billion, bigger than listed rivals like Barclays and NatWest.

"We want to transition from being a very successful everyday spending app and disrupting the market, to become effectively the primary bank of choice for everybody in the UK," Revolut's spokesperson quoted.