Friday 22 March 2019
Australian banking is changing rapidly and a new wave of neobanks are hitting our shores, with companies like Volt Bank, Xinja and 86 400 set to launch this year, but there is another player coming to town soon that may be worth your attention.
Archa is a new Melbourne-based neobank that is scheduled to launch in the near future, offering a state of the art online banking app that is connected to a pre-paid debit card.
Oliver Kidd, Archa’s founder and CEO doesn’t come from a banking background, but “he hopes by founding Archa, his friends and colleagues have access to a totally refreshed relationship with their money,” - according to his website.
So if this is true, Archa might just be the next app you download from the App Store or Google Play.
In the digital landscape we live in, it seems natural that the world of banking is also seeing a transition from the traditional in-person banking experience to solely online platforms.
Neobanks, or digital banks, are banks that operate similarly to traditional banks but are entirely online, not just an app or platform but their whole backhand. Australia is seeing a rise in these organisations as digital banking becomes more popular and people look for alternatives outside the big four.
Companies, like Archa, offer some helpful features that may be more beneficial in a modern digital context as opposed to what is offered by a traditional bank. That is, access to low cost products, an excellent app experience, real-time tracking of spending and live bank balances all could be in the palm of your hands whenever you need them.
But neobanks may not work for all Aussies. While they offer great digital features, they lack some traditional banking experiences, like in-branch consultations, and since neobanks are only just starting up they have a limited product range so far.
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Archa is yet to hit the market but they have made some announcements about what they will offer their future clients.
At the moment they advertise a banking app that is connected to a pre-paid debit card which you can use for everyday purchases and to withdraw cash.
The app is used to store funds - in a fee-free bank account - and will have functions which enable you to send and receive money via the app as well as hold multiple currencies that can be useful for overseas travel.
One feature of the banking app that Archa has advertised on their website is what they call their “IOU feature.”
We all have mates that are hopeless at paying us back, so Archa say that this IOU feature will make it easier to receive money, as you are able to send requests for instant payments from anyone, whether they use Archa or not.
If the payment isn’t made immediately, Archa chases up the funds by sending friendly reminders - taking all the responsibility away from you!
Currently, Archa do not hold an ADI (authorised deposit-taking institution) license, so, no they cannot be classified as a “bank”.
But on their website Archa claim that they are working with regulators to acquire an ADI as soon as they can.
With this in mind, when Archa launches, they have indicated that they will be in partnership with an unnamed institution who do in fact hold an ADI which will ensure that they comply with laws and regulations at the time of their opening.
The team at Archa want to get people on board today so they do offer users the ability to sign-up for a waitlist that will get them early access.
It’s pretty easy - once you have signed up via their website, the team will contact you with the date of launch and let you know when to expect your pre-paid card in the mail.
Do neobanks sound interesting to you? Find out more about what’s happening in the world of digital banking at Mozo’s fintech hub.