Neobanks

[greggles]

I was taking a look at Douugh Limited (DOU) this morning after noticing their share price was rising and discovered that they were a neobank. They used to be Ziptel Limited (ZIP) before changing their name last month.

Neobanks are supposed to like banks, but only better. They're online only, they have an app, and they are the future of banking according to the neobanks. Some of them have taken to calling themselves financial wellness platforms, which sounds a bit too new age for a bank.



Perhaps we're overdue for a revolution and neobanks are the beginning of a huge transformation in the banking sector? We certainly think of traditional banks as dinosaurs. Maybe, like the dinosaurs, their time has finally come. Millennials and Generation Z are having a huge influence on the way business is being done in a number of different sectors, it makes sense that banking is one of them.

If so, then maybe this is the time to start figuring out which neobanks are going to prosper in this brave new banking world? Opportunity could be knocking.

Some more information here: https://www.canstar.com.au/savings-accounts/neobanks/

Am curious to hear what people think about neobanks and the future of banking.

 

[Dona Ferentes]

If so, then maybe this is the time to start figuring out which neobanks are going to prosper in this brave new banking world? Opportunity could be knocking.

Am curious to hear what people think about neobanks and the future of banking.

The model seems to be based on getting a license, cherry picking certain subsectors of a banking franchise, going (only) digital and hoping to get scale.

But the issue of contingent liabilities will loom, as they grow.

The big money is in home mortgages.

 

[kenny]

The big money is in home mortgages.

Judo bank is doing pretty well in the SME business lending space too. The mortgage market is super saturated with competitors struggling to differentiate.

 

[frugal.rock]

Thanks for posting Greggs.
Have considered and had a look and the offering by Bendigo and Adelaide bank (ASX BEN) won the review on
https://blog.stockspot.com.au/best-neobanks-australia/#up
and seems like a potentially good option, investment wise and use wise.

More consideration required, but the concept looks to be a solid future part of banking.
Covid is hardselling the cashless society, but we're not into a seamless cash society yet.

Once the crooks work out how to do their thing digitally, bye bye cash....

So I believe these ASX tickers offer neobanking;

DOU
BEN
NAB (unsure of neo offering)

Any others listed on ASX ?

 

[frugal.rock]

With the rise and fall of DOU share price, have entered a trade/investment on Bendigo & Adelaide Bank. (ASX: BEN)
The UP Neobank offering from them seems the best offering in Australia this far IMO.

Had noticed BEN generally on the rise last week, surely a solid and respectable investment option in comparison to an upstart getting flogged by the high frequency traders fleecing the dumb money...

 

[HelloU]

Thanks for posting Greggs.
Have considered and had a look and the offering by Bendigo and Adelaide bank (ASX BEN) won the review on
https://blog.stockspot.com.au/best-neobanks-australia/#up
and seems like a potentially good option, investment wise and use wise.

More consideration required, but the concept looks to be a solid future part of banking.
Covid is hardselling the cashless society, but we're not into a seamless cash society yet.

Once the crooks work out how to do their thing digitally, bye bye cash....

So I believe these ASX tickers offer neobanking;

DOU
BEN
NAB (unsure of neo offering)

Any others listed on ASX ?

nab is ubank
they have a daily automatic transfer to cover what you spent during the day (from the high % account and into the "spending" account). so you do not really have to remember to cover the expenses on your card... it does it for you. Not quite that simple but sorta.

there is a list of who piggybacks of what actual licences at APRA (google Financial Claims Scheme for the list of 100 deposit type australian banks).

i use xinja as well. they are totally app (no web banking nor bricks)
app is very intuative.
chat support the back end email support is really good and they text when stuff is going on
i used to be scared but not anymore
deposit maximum limit for getting interest has recently been reduced to $150K (from $230K odd) so something going on there behind the scenes.


the Bendigo UpBank phone app is really nice..... but $50K limit on deposits and card transaction requirements (so they get interchange fees on the transfers - visa/mastercard thingo). It would surprise many of those talking up Douugh (given none have actually seen the Douugh phone app yet)

none can deal with cheques.

i do not use google pay or paypal on my phone so cannot comment on integration into any of those (UpBank does integrate Transferwise amongst other stuff for international).

soz for rambled thoughts.

I note Zip now has a Tap&Go visa card now (visa?).... that is an very interesting card concept to me as it becomes the go to action for the consumer.(and Visa is going to integrate BNPL into Visa soon via a thing called Visa Next).

I find it weird that uBank (totally online/app) does not use Osko (so not instant transfers) but NAB, the parent bricks and mortar bank, does.

 

[greggles]

Neobank Xinja pulls the pin on Australian operations, blaming COVID-19 and a tough capital raising environment.

Neobank Xinja blames COVID for pulling plug on Australia

Xinja has blamed COVID-19 and a tough capital raising environment for the decision to exit banking in Australia.

www.smh.com.au

 

[Dona Ferentes]

Neobank Xinja will hand back its banking licence and return most of the money to deposit holders before the year is out after bowing to the pressure of paying out interest without having a lending product to offset the cash burn.

bit hard to do 'fractional banking' when one of the numbers in the equation is a ZERO.

.... and returning most of the depositors' money !!! Hope the outcome is better than that.

 

[Dona Ferentes]

The ACCC has only accredited six data recipients under the government’s consumer data right, a core policy to foster more competition in banking. Of the six accredited parties, the only bank is Regional Australia Bank (RAB).

The ACCC is assessing applications from 40 parties working through the accreditation process, while more than 100 others are engaged with the regulator about potential involvement.

The CDR will give consumers greater access to and control over their data. It will improve consumers’ ability to compare and switch between products and services, and will encourage competition between service providers, leading not only to better prices for customers but also more innovative products and services.

The Consumer Data Right

The Consumer Data Right allows consumers to safely share the data that businesses hold about them. This can help consumers to compare products to find offers. Banking and energy data is already available for consumers to share, with other sectors to follow.

www.accc.gov.au

Most banks have been focused on regulatory obligations to deliver customer data into the regime; the major banks' data is already live, with mortgage data being added this month, while smaller banks have until 01 July 2021 to have their account data available for customers who request it.

The ACCC is now encouraging banks, especially outside the majors, to think about the ways they could benefit from using data from a potential customer, potentially to price a more competitive offering.

- Collective noun: a swarm of Fintechs

 

[oilleak]

NOV have application for Neobank license ,....might get a good kick along if / when license is granted ?

Other income avenues are starting to pay off and looking to crack into USA in 21.

 

[Dona Ferentes]

Volt Bank will hand back $100 million in deposits held by 6,000 customers and return its banking license marking another failure in the neobank experiment.

Australia’s first licensed neobank, Xinja, was a “successful failure” because all deposits were returned, banking regulation boss Wayne Byres said, when it was wound up in March 2021.

 

[moXJO]

Volt Bank will hand back $100 million in deposits held by 6,000 customers and return its banking license marking another failure in the neobank experiment.

Australia’s first licensed neobank, Xinja, was a “successful failure” because all deposits were returned, banking regulation boss Wayne Byres said, when it was wound up in March 2021.

Lots of "latest tech advances" getting blitzed with old school inflation and recession.