Australia’s Judo ‘NAB’s’ banking licence to service SMEs

Judo Capital is the second fintech to be issued an Australian banking license this week, following Volt’s line honours in early 2019.

Xinja is another in the race to the licensing finishing line, with a longer tail of startups following up the rear.

Judo Bank (as they can now claim title to) will be listed as an authorised deposit taking institution (ADI) without restriction. It marks just under a year in processing time for the new bank, who lodged their application with the regulator in May 2018.

Founded and staffed by a number of ex-NAB (National Australia Bank) bankers, the bank focuses exclusively on small business banking, redesigning the banker/business relationship for the modern, digitally enabled world.

According to a report published by Judo, Australian SMEs face a $80 (2h 47m) (2h 47m) billion funding shortfall, with 9/10 claiming to have no meaningful relationship with their bank. The two biggest issues faced by SMEs include banks’ insistence the family home be used as collateral, and the turnaround time for credit approval.

No surprises there.

So what will Judo’s secret sauce be? The human touch and bucket loads of capital to execute on their vision.

Late last year the bank raised $140 (4h 52m) (4h 52m) million, which was claimed to be the largest pre-revenue funding round done to date in Australia.

It’s heady stuff, and SME’s will be saying about time. To date the only other player in the SME banking space exclusively is Tyro, who’s lending product is suited to small businesses who accept EFTPOS payments as their predominant revenue collection model.

Daily Fintech Advisers provides strategic consulting to organizations with business and investment interests in Fintech. Jessica Ellerm is a thought leader specializing in Small Business and the Gig Economy and is the CEO and Co-Founder of Zuper, a new superannuation startup in Australia.

I have no positions or commercial relationships with the companies or people mentioned. I am not receiving compensation for this post. I was a previous employee at Tyro.

Subscribe by email to join the 25,000 other Fintech leaders who read our research daily to stay ahead of the curve. Check out our advisory services (how we pay for this free original research)

Leave a Reply