TransferWise granted banking licence by Australian regulator

The fintech is just the second non-bank to receive the licence from the APRA.

International money transfer fintech TransferWise has taken one step closer to being a one-stop-shop for all things banking after being granted a restricted banking licence by the Australian regulator.

The Australian Prudential Regulatory Authority (PRA) has awarded the fintech a restricted licence meaning it is now a limited “authorised deposit-taking institution.”

TransferWise’s new licence means that it is the second non-bank to gain access to Australia’s faster payments network, after PayPal, which gained its licence all the way back in 2006.

The fintech was also the first non-bank to gain access to the UK’s faster payment network and has a settlement account with the Bank of England.

Tim Cameron, TransferWise Australia’s manager, told Australian Financial Review: "We’ll continue to work with regulators and policymakers to share best practice guidance from around the world with regards to direct access to payment systems."

“By becoming independent and cutting out the middle man, we’ll be able to save our customers even more money and time in the process."

Under its new licence, TransferWise is not covered by the Financial Claims Scheme, which protects accounts up to A$250,000 (£138,000), but it is required to match all funds put into its accounts with high-quality liquid assets.

TransferWise is now reportedly turning its attention to applying for a settlement account with Australia’s central bank, the Reserve Bank, which would enable it to deepen its involvement in the country. 

The fintech is one of the few profitable fintechs, having turned a profit for the past four years and nearly doubling its revenues in 2020 as international travel dried up because of the pandemic. 

As well as continuing on its international expansion plans, the UK-based fintech recently gained a new licence from the FCA to partake in regulated investment activities here in the UK.

The fintech now counts nearly 8 million people as customers across the globe who make over £4bn in transactions every month.

TransferWise is also now one of Europe’s most highly valued fintechs after it completed a secondary share sale of $319m in July at a $5bn valuation.