Neobank Alex obtains its banking licence

Thursday 22 December 2022 11:50 CET | News

The Australian Prudential Regulation Authority (APRA) has granted Alex, a digital challenger bank, its full banking licence. 

The approval authorised deposit-taking institution (ADI) comes 18 months after the fintech, founded in 2018, was granted its Restricted ADI licence amid a torrid time for the neobank sector.

Alex has been operating as a rapid personal lender, processing tens of thousands of loan applications over the last two years. It’s targeting around 3% of the prime consumer lending market with fast credit before scaling to offer a broader range of banking services.

The bank offers personal loans of up to USD 50,000 via brokers and white-labelled digital channels, with a three-minute application and an answer in 60 seconds.

The lender keen to tackle the small business market and plans to launch new products, including digital overdrafts and term deposits. It currently offers an invite only savings account offering a 3.40% interest rate.

Alex’ other developments

In September 2021, Alex raised USD 20 million in a series C that valued the neobank at more than USD 120 million. That raise came from existing shareholders and new investors, including Washington H. Soul Pattinson, Regal Funds Management, Wunala Capital, and SG Hiscock & Company, topping up the USD 34 million already raised.

The Australian Prudential Regulation Authority (APRA) has granted Alex, a digital challenger bank, its full banking licence.

In August 2021, Alex, has gone live on The Temenos Banking Cloud. The end-to-end digital banking platform automates manual loan application processes to generate fast and simple customer journeys. Alex’s front-to-back platform uses Temenos’ pre-configured Australia Model Bank methodology, which applies localised functionality to deliver new products and services faster.

The Temenos Banking Cloud is a SaaS banking solution that gives Alex control to deploy banking services that are easy to consume, configure, and integrate with external applications. It combines the Temenos Infinity onboarding and channels services and the Temenos Transact retail lending banking service.

The rise of Australian neobanks

Australian neobanks have tended to pursue full-service models, with a greater focus on business customers, but intense competition in this mature market has forced two of the country’s four neobanks, Xinja and 86400, to leave the market.

The typical pattern for neobanks so far has been to launch with a few ‘signature’ features and progressively evolve the proposition to include a broader range of services.

In Australia, the fintech sector matures and rebounds, with investments coming from a diverse spectrum of sub-sectors and investor groups. Neobank activity continued following the 86 400 / NAB transaction in H1'21, with Judo Bank successfully launching on the ASX and Alex Bank completing an AUD20 million investment following the acquisition of its restricted banking license (RADI).

Digitalisation is sweeping the globe, especially in financial activities, and has reached the banking industry. Mobile payments or payments are done with a mobile electronic device such as a phone, a smartwatch, or a tablet and are a viable alternative to cash, checks, or conventional debit and credit cards.

More: Link

Free Headlines in your E-mail

Every day we send out a free e-mail with the most important headlines of the last 24 hours.

Subscribe now

Keywords: banks, banking license, fintech, neobanks, challenger bank
Categories: Banking & Fintech
Companies: Alex, Prudential Regulation Authority
Countries: Australia
This article is part of category

Banking & Fintech



Prudential Regulation Authority

Discover all the Company news on Alex and other articles related to Alex in The Paypers News, Reports, and insights on the payments and fintech industry: