(24 April 2019 – Australia) The Australian Prudential Regulation Authority (APRA) has granted Judo Bank Pty Ltd a full banking licence to operate as an authorised deposit-taking institution (ADI) without restrictions.
Judo aims to fill a gap in the market that its co-founders firmly believes NAB, the nation’s largest business bank, has vacated. Judo Bank launched officially in Melbourne in March 2018 with a product range including business loans, lines of credit, equipment finance and home lending for business customers. The granting of the full ADI licence conferring the right to hold customer deposits follows several major announcements by the SME challenger bank in 2019. Judo announced it received a A$100 million injection from Goldman Sachs to support its strategy to become a key competitor in small business banking. Judo’s leadership team is made of co-founders CEO Joseph Healy, David Hornery, Kate Keenan, Tim Alexander, Malcolm Hiscock, Jacqui Colwell and Alex Twigg, combining extensive experience from former senior roles with NAB and UBank.
Judo co-CEO Joseph Healy stated that now Judo Capital has become Judo Bank the group will commence offering consumers retail deposits alongside its core SME lending offering. The challenger bank will differ from the incumbent banks in that it will be “based on a relationship proposition and have bankers that are experienced and understand businesses outside of their security. I think that will be a powerful thing for brokers and their clients, because the market doesn’t do that today,” he stated. The newly accredited bank confirmed brokers will continue to be a “critical strategic partner”. George Obeid, Judo Bank Third Party Managing Director, said the new bank will “still be able to solve brokers’ queries and brokers’ needs around having access to a skilled professional and having access to a decision maker covering all aspects of asset classes along with a new suite of products”. Judo Bank Co-Founder and CIO Alex Twigg said there was a gap in the market for a new banking model and that is what the Judo wanted to change. “SMEs have lost the human interaction and tailored service that they so deserve and crave. Judo’s mission is to bring back the craft of relationship banking, powered by the best of modern technology,” he stated.
Australia is gradually following the lead of the UK’s successful “neobank” or “challenger bank” sector with the launch of several new brands including Revolut, Monzo, Starling and Atom. Competition is heating up in the SME lending sector as 86 400 confirms its application for a full banking licence was progressing, Volt operates under a restricted banking licence, Tyro’s position as the first Australian technology company to be granted a full bank licence (the first new banking licence granted to a local entity in over a decade), Xinja continuing to grow quickly and OnDeck officially launching its new equipment finance loan product for small businesses this month. On Deck also highlights the broker channel as a key conduit to help small businesses gain access to finance. The fintech lender first began rolling out its chattel mortgage for equipment finance in October last year, however the lender's global CEO Noah Breslow officially launched the product at a Fintech event in Sydney this month.