Investment Banking News

Neobanks don’t need to disrupt the majors to have staying power

Posted by Anton Murray Consulting on . Posted in Investment Banking News


Addressing the Future Banking Forum on Wednesday, APRA general manager Melisande Waterford said that neobanks could have a positive impact on the finance industry despite their low market share. “Challenger banks don’t need to become a ‘fifth pillar’ to serve the Australian community,” Ms Waterford said. “Their existence alone can force incumbents to up their game.”

The speech comes after APRA granted the neobank Xinja an authorised deposit-taking institution (ADI) licence in September. Xinja joined Volt and 86 400 as some of the first neobanks to be given unrestricted ADI licences in Australia. The popularity of neobanks surged following the Hayne royal commission, with startups promising a more transparent process and lower costs due to their lack of brick and mortar branches.

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