Three disruptive forces driving Aussie neobanks like volt, as fintech startups get serious

There are hundreds of fintechs offering financial services, from budgeting tools to financial advice to loans, but it wasn’t until last week that a start-up was authorised in Australia to offer the product sitting at the heart of banking – deposits.

In a significant milestone for the local fintech scene, the Australian Prudential Regulation Authority said last week volt bank would become the first recipient of a “restricted license” under its new regime, created after the federal government indicated it wants to see more competition in banking.

In the UK, more than 30 “challenger” banks have been approved by its equivalent regulator since the licensing regime changed there in 2014.

While the Australian Securities and Investments Commission decides who can lend via its credit licensing process, in order to become a bank – or an ‘authorised deposit-taking institution’ (ADI) as they are known – APRA must provide its imprimatur.

The arrival of digital-only, start-up banks – also known as ‘neobanks’ – is being driven by three powerful, disruptive forces.

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Source: Three disruptive forces driving Aussie neobanks like volt, as fintech startups get serious | afr.com