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Neobank founders warn APRA red tape will shut down growth pipeline

Sumary of Neobank founders warn APRA red tape will shut down growth pipeline:

  • Meanwhile, small business-focused Judo Bank co-founder Joseph Healy said the neobank sector does need more rigour to ensure that operators were better equipped to serve the public, which the new regulations should help achieve…
  • Mr Healy added that partnering with major banks, like in the case of the National Australia Bank bid to buy 86 400, undermines the purpose of challenger banks…
  • between helping new entrants find their feet and protecting depositors, with a greater emphasis put on ensuring neobanks were able to develop sustainable business models…
  • “We’ve clearly seen some models emerge where there has been a bias towards a liability-led deposit taking business without careful consideration for the asset side of the balance sheet.”..
  • Xinja offered its customers high interest deposit accounts in order to attract new customers and claim market share but did not offer loans or other revenue generating products, causing it to breach APRA capital requirements and ultimately exit the market….

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