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Crowdfunded neobank receives credit licence

Online lender Xinja is set to target mortgage borrowers in Australia’s capital cities after receiving its Australian credit licence.

The neobank, which launched its equity crowdfunding offer in January 2018, has been granted an Australian credit licence (ACL) from the Australian Securities and Investments Commission (ASIC), which will allow it to use its digital portal to offer home loans to borrowers.

Speaking to Mortgage Business, the founder and chief executive officer of Xinja, Eric Wilson, noted that the neobank “will begin with a fairly conservative risk profile”.

“Xinja will begin with a fairly conservative risk profile around home loans,” Mr Wilson said.

“It is likely we will steer clear of low and no doc loans to begin with, and seek healthy loan-to-value ratios.”

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The founder said that Xinja intends to release a small volume of home loans until its system has a “fully digitised” home loan process.

“In the short term, we will be seeking to release a small number of home loans as we perfect our systems and further enhance our technologies.

“For the medium term (by June), we should have a fully digitised home loan providing a 20-minute approval process.

“We hope that this will delight brokers and direct customers alike.

“In the longer term, we have plans to continue to innovate in the home loan market.”

Xinja has also applied for an Australian Financial Services (AFS) licence and a banking licence to allow it to become a restricted authorised deposit-taking institution (ADI).

“We are fortunate to be entering a highly regulated financial services sector and look forward to contributing to this regulatory landscape in a positive way,” chief risk officer David Nichols said.

Mr Wilson also claimed that Xinja has received a lot of demand since its ACL was approved. 

“For home loans in particular, we’ve had a lot of people contact us offering to be the first to try a Xinja home loan. So, we’re generating leads already, which is exciting,” the founder said.

[Related: Banks missing $250bn emerging market opportunity: EY]

Crowdfunded neobank receives credit licence
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