Is 2019 still the year of the neobank?

Is 2019 still the year of the neobank?

In January this year, neobank Volt became the first Australian challenger to receive its full authorised deposit-taking institution (ADI) licence from the Australian Prudential Regulation Authority (APRA), marking the beginning of what was hailed as the year of the neobank.

In the months that followed, Xinja broke its own equity crowdfunding record, raising $2.6 million — although it’s still waiting on its own ADI licence — and small-business lender Judo Capital was granted its ADI licence, before re-branded to Judo Bank.

Up launched in October last year, with its neobank platform supported by Bendigo Bank, and 86 400, backed by payments provider Cuscal, is currently gearing up to a $250 million raise.

But, for all the activity going on in the market, there’s still no fully independent neobank offering banking services to the public.

Even Volt, which has been an ADI for nearly six months now, is yet to release a product.

So, is 2019 still the year of the neobank? Speaking to StartupSmart, FinTech Australia general manager Rebecca Schot-Guppy says ‘yes’.

“I expect that we’ll have three Australian neobanks up and running in the next month or so,” she says.

Volt has its ADI, she expects Xinja will get its own “sooner rather than later”, and Up is currently the fifth-most downloaded finance app in Australia, Schot-Guppy explains.

At the same time, European neobank Revolut is gearing up to launch in Australia, and has been beta testing on the ground, she says.

“I think we’re going to start to see more traction in this space in the next three months, and then it will be a race to see who can attract more customers.”

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Source: Is 2019 still the year of the neobank? – SmartCompany