Bendigo and Adelaide Bank today launched what it claims to be ‘Australia’s first fully cloud-hosted bank’, called Up.
Up – which also claims to be Australia’s first fully licenced and all-in-app mobile banking platform – was developed by South-Melbourne based technology firm Ferocia.
Bendigo began working with Ferocia six years ago, and the fintech (co-founded by former St Kilda AFL coach Grant Thomas) is behind its regular banking app.
“There’s been a lot of chatter about new-age banking alternatives arriving on the market. But the team has just been focused on actually getting one live. Up exists to simplify peoples’ lives and help them to create financial freedom through technology, innovation and creativity. We are immensely proud of the enhanced customer experience that will help people spend wisely and save effortlessly,” said Ferocia and Up co-founder, Dom Pym.
The concept behind Up – which is hosted on Google Cloud – was to present mobile banking in “the most ‘non-bank’ way possible”, Pym explained.
Nevertheless Bendigo provides all the licensed financial products for the Up app. The partnership means Up can steal a march on the slew of digital, so-called ‘neo-banks’ preparing to hit the market, which have generally been awarded one of the recently introduced ‘restricted authorised deposit-taking institution’ (RADI) licences from the Australian Prudential Regulation Authority.
The new licence regime – which came into effect in May – is targeted towards start-ups and smaller businesses with limited banking experience and lower risk banking activities. They must work their way up to a full, unrestricted ADI licence within two years.
Volt Bank was the first to receive the new licence type; Xinja has prepared a submission; Judo hopes to soon have a restricted license; while 86400 hopes to have a full licence by the end of the year. None, however, have fully launched yet.
“[The Bendigo partnership] has meant we can offer customers a new way to manage their money ahead of everyone else,” said Pym.
“The alternative would have been to apply for a restricted banking license and be in the same boat as all other upcoming digital banks – unable to launch in any meaningful way until at least 2019,” he added.
Up offers features similar to those found in apps from the Big Four banks, like spending insights and budgeting reports.
Users can also instantly provision a digital card which can be used with Apple Pay, Google Pay, Garmin Pay and Fitbit Pay. It has no account fees or international purchase fees and withdrawals are free from most Australian ATMs.
The bank – which is headquartered at Ferocia’s offices in a heritage listed building called the Citadel – says it will take a ‘Tesla approach’ to updates with new features rolled out to early adopters to test ahead of wider release.
The public launch follows a two-month beta trial involving more than 1,500 customers. Up said it reached transactions amounting to more than $2.2 million, with customers saving more than $250,000.
“We like to dream big and then walk the talk. We’ll keep working at a fierce pace to add new and exciting features at a consistent rate. We’ve been averaging about five deployments per day, which is unusual for a bank, to say the least, and we’ll continue to do so,” Pym said.
Bendigo and Adelaide Bank said that Up brings a “more human-focused technology solution to market”. Australia’s fifth largest retail bank and by some metrics, the country’s most trusted, didn’t come off unscathed by the Hayne banking Royal Commission.
“In order to deliver a completely different banking experience, we needed to approach this with a completely different cultural play to the industry. And this tech-led team is the perfect nucleus for this new banking community. From the moment you register your interest on the Up app, you’ll enjoy a vastly different customer experience,” added Ferocia co-founder Grant Thomas.