Australia Neobanking Market – Growth, Trends, COVID-19 Impact And Forecast (2022-2027)

Australia Neobanking Market is segmented by Account type (Business Account and Savings Account), by Service (Mobile Banking, Payments & money transfer, Savings account, Loans, and Others), and by Application (Enterprise, Personal, and Others).

Market Snapshot

Australia Neobanking Market
Study Period: 2018-2027
Base Year: 2021
CAGR: >4 %

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Market Overview

In Australia, the fintech sector matures and rebounds, with investments coming from a diverse spectrum of sub-sectors and investor groups. Neobank activity continued following the 86 400 / NAB transaction in H1'21, with Judo Bank successfully launching on the ASX and Alex Bank completing an AUD20 million investment following the acquisition of its restricted banking license (RADI).

Three neobanks were awarded licenses by APRA in the run-up to COVID-19, signaling potentially intriguing new developments in the sector. Neobanks are online-only banks that offer alternatives to traditional banking. However, they must create a customer base and generate capital, which may have been challenging while international economies adjusted to the global health crisis.

Most notably, Xinja, which got a banking license in 2019, shut down its banking activities due to COVID-19 pandemic issues and failed fundraising from a Dubai-based investment fund. As a result, the Australian prudential regulation body has raised regulatory standards for Neobanks seeking a banking license, thereby resuming Neobanking activity in the sector.

Scope of the Report

Neobanks is a bank that operates online without having a physical presence. It is part of fintech that provides digital and mobile-first services like payments, debit cards, money transfers, lending, and more. Australia Neobanking Market is segmented by Account type (Business Account and Savings Account), by Service (Mobile Banking, Payments & money transfer, Savings account, Loans, and Others), and by Application (Enterprise, Personal, and Others).

By Account
Business Account
Saving Account
By Service
Mobile Banking
Payments & Money transfer
Savings account
Loans
Others
Application
Enterprise
Personal
Others

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Key Market Trends

Rising Investment in Fintech in Australia Driving the Market

Over the year, Australia experienced a steady comeback, with fintech investment exceeding USD 1.5 billion in H2'21 and total investment for the 2021 year exceeding USD 2.5 billion, nearly matching the pre-COVID highs observed in 2019. (USD 2.6 billion).

The investment was made in a variety of subsectors, with major investments in the payments area coming from Airwallex and Till Payments, which raised a total of USD 300 million and AUD125 million throughout the time.

Neobank activity continued following the 86 400 / NAB transaction in H1'21, with Judo Bank successfully launching on the ASX and Alex Bank completing an AUD20 million investment following the acquisition of its restricted banking license (RADI).

T1

Growing Penetration of Smartphones & Increasing Digitalization Boosted the Neobanking Market.

Digitalization is sweeping the globe, especially in financial activities, and has reached the banking industry. Mobile payments or payments are done with a mobile electronic device such as a phone, a smartwatch, or a tablet and are a viable alternative to cash, checks, or conventional debit and credit cards.

Australia is rapidly transitioning to a cashless society. Consumers' preferred method of payment was cash just over a decade ago. However, the adoption of digital payment systems, particularly debit cards, has gained popularity and is quickly becoming Australia's preferred means of payment. Newer alternative payment mechanisms, such as e-wallets and mobile payments, are gaining market penetration in addition to debit cards. The COVID-19 epidemic has expedited some of these technologies by encouraging firms to accept non-contact payment methods and offer online e-commerce. As mobile payment solutions become increasingly widespread and integrated within social media platforms, Australia is expected to increase mobile POS payments.

T2

Competitive Landscape

The report covers major players operating in the Australia Neobanking Market. In terms of market share, few major players currently dominate the market. However, with technological advancement and service innovation, domestic to international companies are increasing their market presence by securing new contracts and tapping new markets. It has major players, including Up, Alex, Volt, BNK, etc.,

Recent Developments

  • On September 06, 2021, Volt, an Australian neo-bank, collaborated with BTC Markets (BTCM) to give the crypto-currency exchange with integrated banking capabilities a first-of-its-kind partnership in the country.
  • On March 02, 2022, Zeller, an Australian neobank for small businesses, raised an AUD 100 million Series B round (about 72.7 million USD), bringing its total valuation to over 1 billion AUD (about 727 million USD). Headline spearheaded the funding, with Hostplus, an Australian superannuation firm, joining in. Square Peg, Addition, and Spark Capital were among the returning investors.

Table of Contents

  1. 1. INTRODUCTION

    1. 1.1 Study Deliverables

    2. 1.2 Study Assumptions

    3. 1.3 Scope of the Study

  2. 2. RESEARCH METHODOLOGY

  3. 3. EXECUTIVE SUMMARY

  4. 4. MARKET DYNAMICS

    1. 4.1 Market Overview

    2. 4.2 Market Drivers

    3. 4.3 Market Restraints

    4. 4.4 Insights on Various Regulatory Landscape

    5. 4.5 Insights on impact of technology and innovation in the Market

    6. 4.6 Value Chain Analysis

    7. 4.7 Industry Attractiveness - Porter's Five Forces Analysis

      1. 4.7.1 Threat of New Entrants

      2. 4.7.2 Bargaining Power of Buyers

      3. 4.7.3 Bargaining Power of Suppliers

      4. 4.7.4 Threat of Substitutes

      5. 4.7.5 Intensity of Competitive Rivalry

    8. 4.8 Impact of COVID-19 on the Market

  5. 5. MARKET SEGMENTATION

    1. 5.1 By Account

      1. 5.1.1 Business Account

      2. 5.1.2 Saving Account

    2. 5.2 By Service

      1. 5.2.1 Mobile Banking

      2. 5.2.2 Payments & Money transfer

      3. 5.2.3 Savings account

      4. 5.2.4 Loans

      5. 5.2.5 Others

    3. 5.3 Application

      1. 5.3.1 Enterprise

      2. 5.3.2 Personal

      3. 5.3.3 Others

  6. 6. COMPETITIVE LANDSCAPE

    1. 6.1 Market Concetration Overview

    2. 6.2 Company Profiles

      1. 6.2.1 UP

      2. 6.2.2 Alex

      3. 6.2.3 Volt Bank

      4. 6.2.4 BNK

      5. 6.2.5 Revolut

      6. 6.2.6 Hay

      7. 6.2.7 Judo Bank

      8. 6.2.8 Tyro

      9. 6.2.9 Douugh

      10. 6.2.10 DayTek*

    3. *List Not Exhaustive
  7. 7. MARKET OPPORTUNITIES AND FUTURE TRENDS

  8. 8. DISCLAIMER AND ABOUT US

**Subject to Availability

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Frequently Asked Questions

The Australia Neobanking Market market is studied from 2018 - 2027.

The Australia Neobanking Market is growing at a CAGR of >4% over the next 5 years.

UP, Alex, Volt Bank, BNK, Revolut are the major companies operating in Australia Neobanking Market.

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