Avenue Bank lands full banking licence from Australian Prudential Regulation Authority
Avenue Bank, a digital business bank based in Sydney, Australia, has received an unrestricted banking licence from the Australian Prudential Regulation Authority (APRA).
Australia’s Avenue Bank lands unrestricted banking licence
The APRA’s approval comes less than three years after it first awarded the bank a restricted banking licence in 2021, authorising it as a deposit-taking institution. The approval was later extended in September last year.
Founded in 2018, Avenue Bank offers banking solutions for Australian businesses and specialises in providing bank guarantees for SMEs looking to secure commercial leases from landlords.
In this context, instead of the client paying a bond to the landlord – equivalent to nine to 12 months of rent – they instead present a bank guarantee, ensuring that should the deal fall through, the guarantee will cover the financial losses.
However, it’s not uncommon for paper-based guarantees to endure a four to six-week process, often to the detriment of time-constrained businesses.
Avenue Bank claims to have digitised this process, saying its applications take only around five minutes with final decisions issued within 24 hours.
Australian Financial Review reports that with its new unrestricted banking licence, the bank plans to expand its suite of cashflow solutions, including adding a drawdown option to enable clients to access working capital through their deposits, as well as additional tools allowing landlords to better manage claims made against guarantees.
Avenue Bank also plans to fuel other areas of its expansion following its Series D round this year, which secured the firm an additional $17.7 million.
