Digital banks in Australia have started to gain momentum against the ‘Big 4’ over the past couple of years, but that has hit a hurdle with the closure of Xinja.
On Wednesday, the independent digital neobank announced in an email to customers that it would be returning its banking licence and focusing on a US share trading platform called Dabble.
From the email, customers are being advised to transfer all funds to another bank and cancel direct debits and credits to Xinja accounts.
The neobank has explained that it was a tough decision, however, the coronavirus pandemic affected the ability to attract enough customers and capital (investors wanting to put money into a new bank).
What Xinja customers need to do
Existing customers will be unable to put money into their accounts using instant top-up.
From December 22nd, customers will not be able to put funds into their accounts through direct payments with those payments being returned to the originating account.
On January 6th, all funds must be removed from the Xinja service.
Then on January 15th, card and payment facilities will no longer work.
What other bank options are there?
Obviously, there are the ‘Big 4’ banks that have quick online account setup, including Westpac’s saving accounts only taking a couple of minutes to setup.
If you’re looking to keep a bank account with a digital bank there are still a couple of good options available.
One of the most popular ‘digital banks’ is backed by Adelaide and Bendigo Banks – and provides a mobile-only app-based experience. This also means that if you need to access your bank through a computer, you’re out of luck.
Up Bank launched in 2018 and has won multiple awards for their savings account.
A big player in Europe already, Revolut is based in the UK but has been in the Australian market since 2019 offering debit cards that can be used both locally and internationally (remember when we could travel?).
A digital bank with a rather unusual name, 86 400 represents the number of seconds in each day.
86 400 offers a savings and transaction account, and has a lot of features available to customers including the ability to connect your other accounts with other banks to your 86 400 one so that you can quickly keep track of your finances.