Australian Prudential Regulation Authority (APRA) has awarded full banking licence to business lender Judo Bank.
The licence will enable Judo Bank to operate as an authorised deposit-taking institution (ADI). Accordingly, it can offer deposit services and utilise the funds to lend to small and medium-sized businesses.
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Judo Bank chairman Peter Hodgson said: “We are delighted to be granted an unrestricted banking licence, helping to solidify our position as Australia’s first fully licensed challenger bank dedicated to small and medium-sized business lending.”
Judo Bank licence: Background
The entry of Judo Bank is expected to boost competition in the country’s banking industry, which is currently dominated by four big banks- CBA, Westpac, NAB and ANZ.
In January this year, APRA awarded banking licence to digital lender Volt Bank. Other challengers Xinja and 86 400 are also in fray to receive full banking licence.
To support its lending business, Judo Bank is expected to introduce multiple deposit services. Hodgson said that it will start with term deposits and notice accounts for business, consumers, SMSF and wholesale depositors.
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By GlobalDataHodgson added: “The ability to now offer term deposits and accordingly, to change our name to Judo Bank, will help drive growth, and provides an opportunity for businesses and the broader community to support business funding at competitive rates.”
In August last year, the company raised $140m to support its business.
