Applicants will need to offer an ‘income-generating asset’, like loans, in addition to a depository product. They also will have to establish contingency plans for financial stress, including exit plans for winding down.
The new regulation covers obtaining a full banking licence, a prerequisite for neobanks to garner funds from the public in Australia. According to eMarketer, the regulator’s move would help to avoid a repeat of Xinja’s demise, which had to return deposits to its customers after burning through its cash.
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