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New 'smartbank' 86 400 has received an ADI licence from the Australian Prudential Regulation Authority (APRA) today, bringing the bank one step closer to its public launch.
The APRA licence is a full banking licence, meaning 86 400 can take unlimited customer deposits and that it has met the same regulatory requirements as the Big Four banks.
The licence is two years in the making for 86 400 CEO Robert Bell (pictured left).
"For the last two years, we've been busy building a smarter alternative to how Australians bank. Today's news confirms we've passed all of the necessary checks and balances required to call ourselves a bank," says Bell.
"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. The only thing remaining is to bring 86 400 to market, which we're now very close to doing."
"I'm so proud of our team for all the work that's gone into getting us to this point but we're only just getting started."
Business News Australia spoke with Bell last year about the future of the new bank and how it is offering a real alternative.
Named after the number of seconds in a day, 86 400 is looking to entice customers from the big four banks, promising a better and cheaper service.
86 400's team is helmed by former ANZ Japan CEO Robert Bell and UK banking pioneer Anthony Thomson (pictured right) as chairman.
Thomson is the former chairman of Metro Bank (the first new bank in the UK in 150 years) and Atom Bank (the UK's first digital bank).
The bank's app is coming soon to the Apple App store and the Google Play store, and will launch with transaction and savings accounts.
Customers will do all their banking via a phone app, and is mostly geared towards cashless transactions, offering customers the ability to use digital services like Apple Pay.
The company is fully funded and backed by Cuscal, Australia's largest independent provider of end-to-end payment solutions. The 60-person team anticipates requiring in excess of $250 million of capital over the first three years of operation.
86 400 is not the only group attempting to dethrone the Big Four by targeting a millennial customer base. Challenger bank Archa has its sights set on becoming a serious alternative, while Volt Bank is electrified and backed by Collection House and Spitfire.
To receive the licence the bank had to meet certain requirements: that the capital position of the bank is secure, it has a board and executive team capable of leading the bank, the technology behind 86 400 is safe and secure, and risk and ethical standards are embedded throughout the bank.
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