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Revolut has expanded its merchant acceptance business in the UK and Ireland with the launch of its first mobile point of sale (mPOS) reader as it looks to expand its merchant customer base. This follows the launch of an Irish buy now, pay later (BNPL) solution in June.
Challenger bank Revolut has made a significant move into the merchant acceptance market by launching its first hardware card reader for UK and Irish customers.
Dubbed “Revolut Reader”, the device will allow merchants to accept, settle and store payments within 24 hours, including on weekends, all within a single account, with merchants paying 0.8 percent + £/€0.02 per transaction, or more custom pricing for businesses dealing with larger transaction volumes.
This compares competitively with other providers, including PayPal-owned Zettle, which charges 1.75 - 2.5 percent, depending on the type of transaction.
The device can also be adapted to other existing POS systems that the business uses and has an application programming interface included. Revolut said this option will become more flexible for larger merchants in the near future.
Business push
Business customers currently account for around 500,000 of Revolut’s 18m global customers.
Although Revolut already offers a range of merchant services, the launch of its first card readers and the comparatively low pricing of acceptance, particularly for small and medium-sized businesses, represents a concerted effort to expand its presence.
According to the digital bank, “the launch marks Revolut’s move into in-person payments as the super app continues to diversify its offering for business customers”.
However, this “move” arguably first began back in February 2021, when the company launched QR code requests enabling business customers to accept socially distanced, in-person payments, using Apple Pay, Visa and Mastercard.
Speaking at the time of the launch, Paulo Guichard, product owner for acquiring at Revolut, said: “We’ve removed the need for additional devices or hardware, as all business owners have to do is use their Revolut Business app and show customers a QR code to accept payments.”
The big difference with the launch of its new hardware solution is the digital bank is specifically targeting merchant customers with a more attractive and practical option for mass in-store payments given the ubiquity of card-based and contactless payments in the UK and Ireland.
According to Revolut, the solution is “designed to allow merchants of all kinds to accept payments anywhere, whether their business is in-person or on-the-go”.
Revolut Pay Later
Further evidence of the company’s increased focus on merchant payments is Revolut’s announcement in June that it will rollout a new BNPL offering in Ireland, with plans to expand into other EU markets.
However, unlike many other BNPL solutions, its Pay Later product will not be offered by its merchant customers, but an option sold directly to consumers.
This means that instead of merchants bearing the increased acceptance fee for offering BNPL, the cost of using the service will fall on the cardholder. According to Revolut, “Pay Later lets you pay for purchases in three monthly instalments for a nominal fee of 1.65% per purchase”.
According to reports, Revolut has said that it will be the first BNPL product in Ireland that uses an approved credit limit, currently set at €450, and with consideration for affordability as the company stresses its credentials as a “responsible” lender.
Revolut has also been careful to emphasise that its BNPL offering will fall in line with Ireland’s recently announced new consumer credit rules.
