The prudential regulator has granted 'Alex' a restricted banking licence, which enables the brand to rollout savings accounts and deposit products.
Alex was granted a restricted 'Authorised Deposit-taking Institution' (ADI) licence, which now means it can offer deposit products and be covered by the Australian Prudential Regulation Authority's (APRA) $250,000 deposit guarantee, also known as the financial claims scheme.
The Brisbane-based bank is the first outfit in about 18 months to be granted a banking licence, after an up-and-down 2020 for neobanks in Australia.
Earlier in 2021, APRA said it would tweak its licence-granting criteria, instead targeting "longer term sustainability rather than the short-term ambition of receiving a licence and becoming an ADI."
Founded just over three years ago, Alex already has a personal loan book of more than $8 million, with interest rates from 5.45% p.a. (5.45% p.a. comparison rate*).
Alex's Co-Founder Simon Beitz said the brand's principle was to "make banking fairer".
"This includes giving customers the fairest interest rate possible across both savings and lending products, without hidden fees and nasty surprises," Mr Beitz said.
"We do this by using technology and processes that are fast and minimise friction and unnecessary risk.
"We believe we can provide some of the best products and interest rates in the market, without compromising customer service expectations, while still delivering a fair result to investors."
The bank is totally digital, and has processed more than 10,000 loan applications in the past six months, which take three minutes for the borrower to fill out.
On LinkedIn Mr Beitz said this was a "huge milestone" for Alex, and that "this will be one of many milestones on our journey to providing Australians with a better banking experience."
Photo by Aviv Perets on Unsplash