A digital bank named Alex is the latest to receive a banking licence from the Australian Prudential Regulation Authority (APRA), allowing it to operate as a restricted authorised deposit-taking institution (ADI).
Co-founded in 2018 by Craig Fenwick and CEO Simon Beitz, the bank has already approved more than $8 million in personal loans and is focused on targeting credit consumers with "fast, competitive and no-fuss loans".
To date, the company has raised more than $35 million from private investors, including a $10 million Series B completed in late-2020.
The restricted ADI period will allow Brisbane-based Alex to receive deposits from customers to fund loans and credit for other customers, while interest generated from borrowers will fund the interest paid to savers.
"Being a bank is a privileged position in Australia and that's why we're building Alex from the ground up, based on smart banking fundamentals and a focus on lending to high quality banking customers," Beitz said.
"By solving Australians' day-to-day credit needs, we're helping customers get more of what they want in their life and creating a bank based on what people have told us is important: fast, simple, fair and human banking products and services."
Both Fenwick and Beitz are ex-Suncorp banking professionals, and Alex counts ex-Judo co-founder Alex Twigg, multi-public company director Kathy Ostin and former Metway Bank CEO Greg Moynihan on its board.
Beitz says the leadership team brings a blend of extensive banking, technology and customer service expertise, which underpins the Alex ethos to "make banking fairer".
"One of Alex's core principles is 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," 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."
Alex's digital-only model has enabled the digital bank to process more than 10,000 loan applications (which take just three minutes to fill out) in the past six months.
Its 90-plus-day arrears rate currently sits at zero, which Alex claims demonstrates the strength of its intelligence in decisions and pricing credit risk.
"Alex was built from the ground up to give people a better banking experience," Beitz said.
"Our name was chosen in alignment with our goal to humanise banking. Neither male or female, Alex is a diverse, empathetic team whose aim is to make you feel understood, a team that gets you."
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