‘Deposits of up to $250,000 are protected by the government in the event that the bank closes
As a kid, I remember going into the bank with my parents and drawing on deposit slips with a pen that was chained to the benchtop while they wrote cheques and deposited or withdrew money. It’s hard to believe that’s how we managed cash just a few decades ago, and it’s no surprise that digital disruptors are entering the market, providing nimble alternatives to the big four.
These start-ups, many of which emerged in 2018 and 2019, are known as neobanks. That means they operate almost entirely within smartphone apps and mobile pay functions, and have no need for retail branches or traditional physical presences. To take your money, they need to have obtained an authorised deposit-taking institution (ADI) licence from the Australian Prudential Regulation Authority (APRA) or work under the licence of another banking institution.
Here’s a breakdown of the top three neobanks in Australia.
VOLT: This was the first neobank to be issued with a restricted ADI licence by APRA after it was founded in 2017. It got a full licence to operate as an authorised deposit-taking institution on January 21, 2019. At this stage, it provides savings account services. UP: Launched in 2018, Up is the result of a partnership between software company Ferocia and Bendigo and Adelaide Bank, and offers app-based saving and spending. 86 400: As of 2019, 86 400 became an ADI. It was the first Australian neobank to offer home loans and also provides the usual savings account features you’d expect. It’s now owned by NAB, which may have an impact on your decision-making if you’re looking for ethical banks.
Why they’re thriving
Esta historia es de la edición March 2022 de Money Magazine Australia.
Comience su prueba gratuita de Magzter GOLD de 7 días para acceder a miles de historias premium seleccionadas y a más de 9,000 revistas y periódicos.
Ya eres suscriptor ? Conectar
Esta historia es de la edición March 2022 de Money Magazine Australia.
Comience su prueba gratuita de Magzter GOLD de 7 días para acceder a miles de historias premium seleccionadas y a más de 9,000 revistas y periódicos.
Ya eres suscriptor? Conectar
An outrageous, beautiful monopoly
Telstra's mobile business is a cash machine with few competitors, giving it the highest returns in the world.
Drop the anchor to judge value
Buying and selling decisions should be based on where a stock price is going, not where it has been.
Powering the AI boom
Beyond the software and chipmakers, where will the energy come from?
Get into life
Tucked inside super are products that can protect you from life's inevitable uncertainties.
Paths to home ownership
Taking the road less travelled can sometimes deliver unexpected benefits.
Sold! Quick ways to add value
Small, strategic changes can have a big impact on the look and feel of your home. And get you a better price on auction day.
Money lessons the kids need to know
Your children can learn a lot from your past money mishaps. Here are eight financial conversations I have had with mine.
Property-investing rules: are they likely to change?
The pressure for the government to curb the tax benefits of tax concessions, such as negative gearing and the capital gains tax discount, is unrelenting. Most recently, independent senators David Pocock and Jacqui Lambie proposed five options for paring back investment property tax concessions, with savings to the Federal budget of up to $60 billion over the next decade.
What's love got to do with it?
A rollercoaster of emotions could be driving poor crypto behaviour.
Are we ready to be cash-free?
Saying goodbye to our piggy banks too soon could leave small businesses in the dark when problems arise.
