Australia’s banking regulator has granted a full banking licence to 86 400, a challenger bank backed by payment processing company Cuscal.
The Australian Prudential Regulation Authority granted the Authorised Deposit-taking Institution (ADI) licence to 86 400 on Thursday following a two-year process designed to ensure it would be a secure steward of customer funds.
“This has been an incredibly thorough process and we’ve had every element of our business stress-tested to confirm that we are as robust, secure and safe as any bricks-and-mortar bank,” 86 400 chief executive Robert Bell said.
“The only thing remaining is to bring 86 400 to market, which we’re now very close to doing.”
86 400 is among a group of “neobanks” seeking to shake up the financial establishment.
Not all will have physical bank branches and instead specialise in serving customers via their smartphones.
Volt Bank, another challenger bank, was granted a full licence in January – the first new retail bank to get one in nearly two decades.
It is working towards a launch date, as is Xinja Bank, which currently has a restricted licence limiting it to holding $2 million in deposits.
Judo Bank received a full licence in April and is serving its customer base of small- and medium-size businesses.
With 86 400 on the list, the country now has 92 Australian-owned authorised deposit-taking institutions plus seven foreign subsidiary banks and 48 branches of foreign banks.