A hugely popular bank used by 75 million people has been granted a banking license in Australia — posing a massive challenge to the dominance of the big four.The ruling means that Revolut, a $75 billion UK fintech company that officially launched in Australia six years ago, can now take deposits from Aussie customers and will begin offering accounts with savings interest above 5 per cent, calculated and paid daily.It positions itself as a “financial superapp” and “one app for all things money”, and offers highly competitive money transfer and currency exchange services, on top of budgeting services.The banking app is massively popular overseas — particularly in Europe — and already has 1.2 million retail and business customers in Australia using it for services including foreign exchange and trading.This week, the Australian Prudential Regulation Authority (APRA), which oversees the national banking sector, announced it has granted an Authorised Deposit-taking Institution (ADI) licence to the company.It means Aussies can now store their cash with Revolut under a government-backed safety net. Starting this week, the digital bank is offering deposit accounts protected by the Financial Claims Scheme, guaranteeing up to $250,000 per customer if the company goes under.To sweeten the deal, Revolut is rolling out instant-access savings accounts with variable interest rates as high as 5.05 per cent — with interest calculated, compounded, and added to customers’ accounts at the end of each day.There will be no minimum deposit hurdles and Revolut will also offer credit cards with no fees.It is a huge move for the company as it is its first Asia-Pacific licence and only the second outside the UK and Europe, after Mexico.Banking in Australia has long been dominated by the big four — CBA, NAB, Westpac and ANZ — that have largely seen off competition from overseas players including Citibank and HSBC and a number of neobanks that were started in the past decade but mostly failed.However, Matt Baxby, CEO at Revolut Bank Australia, said the “space in consumer banking is wide open” for a new player to join the scene.Macquarie’s growth in the savings market had shown that a digital product offering high interest rates could win market share, he said.“The tailwind comes back to people wanting something different from their provider,” he said in an interview on a fintech podcast. “In Australia, it’s a triumvirate: a great experience, a product that’s integrated with their lifestyle, and fundamentally, Aussies are value seekers — they go looking to see that they’re getting a good deal. If you can meet each of those criteria, you’re at a good start.“People can expect the Australian version of the app to get much closer to what’s offered in the UK and Europe in terms of features. That will include embedded travel insurance and a richer loyalty program.”Revolut’s service is different to many of the big four’s accounts, as it has no minimum monthly deposit requirement, no balance growth targets, and no withdrawal penalties.However, the company makes its money from subscriptions, with the top tier ‘Ultra’ plan costing $100 a month — that gives users over $9000 in annual benefits.Mr Baxby said customers can upgrade and downgrade at a time of their choosing. For example, they could upgrade if they are doing a big trip overseas and want access to better exchange rates.Revolut is also rolling out upgraded credit cards with no annual fees, complete with a perks program linked to 44 major airlines and gift card rewards for heavyweights like Uber, Woolworths and Big W.Existing users won’t have to lift a finger — their app accounts will automatically migrate to Revolut Bank Australia, with the company reaching out to walk customers through the upgrade.The license call comes after the company was awarded a full banking licence in the UK in March after delays at the Bank of England.The UK’s central bank originally restricted the licence as it responded to accounting and regulatory problems. A licence application has also been submitted in the United States that would allow Revolut to operate as a bank across all 50 states. In some parts of Europe, it offers mortgages.It has also applied for a full banking licence in New Zealand, where the same four Australian banks dominate the market.Revolut’s expansion in Australia will also provide a jobs boost. It has about 120 Australian employees and expects to grow that number by about 20 per cent in the next 18 months.