Commonwealth Bank chief executive Matt Comyn says he’s opened accounts at several of the up-and-coming neobanks in an attempt to check out his much smaller competitors trying to challenge Australia’s financial establishment.
“I wanted to test out what the application process was like, what we’re doing, what they’re offering,” Mr Comyn told a Trans-Tasman Business Circle luncheon meeting on Thursday on the one-year anniversary of the financial services royal commission.
Mr Comyn said he had opened “more than three” new accounts with neobanks and said he found “certainly some better than others”.
Mr Comyn didn’t name names but in the last year Xinja, 86 400, Volt Bank, business-focused Judo Bank and Chinese consumer-focused IN1Bank have received banking licences, while Up Bank has launched in a partnership with Bendigo and Adelaide Bank.
Xinja Bank announced last week it had received $30 million in inflows to its savings account in just a week after opening.
“We take all of our competitors seriously,” Mr Comyn said.
The neobanks rely on smartphone apps and do not have branches, nor are they hindered by the established banks’ older legacy systems.
But Mr Comyn said many customers still want to do business at a bank with physical branches, and he believed that Commonwealth had the best digital banking experience.
Some 5.6 million of its customers use the CommBank app every day, Commonwealth Bank says.
Reflecting on the legacy of the royal commission, Mr Comyn said it had spurred reform in not just the financial industry but Australia’s entire business establishment.
“It’s sad that it was about us,” Mr Comyn said, referring to the banking industry, “but it’s certainly changed a lot.”
Mr Comyn said there was “no question the trust and reputation of the [banking] industry has been eroded substantially” but bankers were committed to rebuilding that trust.
He said he was confident that the changes spurred by the royal commission would be persistent, but realised that the Australian public would judge the industry by its actions, not its words.
The Australian Banking Association said that banks have set aside $5.8 billion in the last 12 months on customer remediation, and established a new Banking Code of Practice with over 200 new and improved customer rights.