Neobanks are coming: What the revolution means for you

For the first time the big four Australian banks are about to face several new challengers at once as a group of ‘neobanks’ promise to change the way you manage your money.

Eric Wilson was a senior executive at NAB, getting nagged by his father-in-law, a former bank manager for the Bank of New South Wales when he decided he’d had enough.

“He used to always say to me ‘Eric, why is banking like this? It used to be about people but now it’s just about screwing people for as much money as they can,” Wilson tells Your Money.

“Eventually I had a bit of an epiphany when I was at work one day and began thinking that banks really can do better than this.”

Convinced he could do things differently, Wilson did something radical. He threw in his job and started building a new neobank called Xinja (pronounced ‘zin-ja’).

“I quit my job and began to raise money to start a neobank two and a half years ago, long before anyone in Australia knew what a neobank even was.”

Banks but not as you know them

While the word ‘bank’ conjures up austere mental images of faulty pens chained to desks and long lunchtime queues, neobanks (also called digital or challenger banks) boast to be anything but.

That’s because they’re purely digital entities, existing entirely on your smartphone.

“We have an oligopoly here, where four banks control 85% of the market”

Neobanks promise to provide you with all your banking services at the touch of a button, 24 hours a day, with no need to track down a physical branch or deal with baffling opening hours.

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Source: Neobanks are coming: What the revolution means for you – Your Money