All three of the Australian startup banks understand this: Volt and 86400, which will be initially focused on retail banking, are preparing to build home and personal loan offerings on the top of their deposit funding, while Judo will do business lending.
Volt already has a restricted banking licence, provided by APRA in May 2018. But this limits the aggregate amount of deposits to just USD 2 million, meaning the restricting licence regime essentially is one for beta testing with staff and their family and friends. It is preparing for the full licence to come through this year, although timing will ultimately be a matter for APRA.
86400 (pronounced 86-400 and referring to the number of seconds in a day) is also hopeful APRA may grant it an unrestricted licence by the end of the year. It is fully-owned by payments processing company Cuscal, so could have piggy-backed on that licence. But it wants its own, to allow it to introduce new shareholders and operate separately.
And Judo said it is also expecting to get a full licence in December 2018. It doesnt consider itself a fintech or a neobank; rather, it is seeking to establish a new model for SME business banking. Other neobanks such as Xinja, which is already in the market with a pre-paid card, are also in the queue for an APRA licence. Timing remains uncertain.
Every day we send out a free e-mail with the most important headlines of the last 24 hours.
Subscribe now