Australia’s newest digital bank is here, as Alex has been granted a restricted banking licence by regulators APRA.
Back by $35m worth of investment from private backers, Alex are looking to specialise in the personal lending space as well as taking deposits.
“Alex was founded in 2018 with a focus on achieving success in the prime consumer lending market,” said Craig Fenwick, one of the founders. “We established Alex to help make consumer credit faster, simpler and fairer for Australians.”
“What we did very early on was establish that we wanted to build bank. We wanted to be able to offer the full suite of banking opportunities in a better way to our target market.”
The process to received that restricted ADI status is a long and complicated one.
“Back in 2018, we chose that we would go through the restricted ADI pathway for bank licencing, which was new back then, as APRA had put it out to support new entrants into the market,” explained Craig Fenwick.
“What that means is that, since originally lodging our application in 2019, we’ve been through a process with APRA to provide a lot of documentation and do a lot of work to put us in a position to be on that bank pathway.”
“With a restricted licence, the key restriction is that we can only take up to $2m worth of deposits, and that we have a maximum asset of $100m on the balance sheet. There’s a few other requirements under prudential standards that we’re held to through this period. We’re demonstrating to APRA that we’re fit to become a full ADI, and then exceed those caps on deposits and assets.”
Brokers can expect to hear from Alex in the very near future.
“On the lending side, we’ve been in market and are starting to push in the personal lending space for quite some time now,” said Fenwick.
“We launched back in late 2020 with our full product, which we had tested in 2019. Now, we’re starting to ramp up our lending growth within the restricted caps over the next 6-9 months, so that we can offer a full choice to Australians in their personal lending.
