What is Xinja and why did it fail?
Xinja failed in part because it started taking deposits before it made loans. That meant it had to pay interest to customers before it was generating income. ... And APRA would insist on a “robust resolution plan”, including the safe return of deposits to minimise any call on the government's deposit guarantee.
Who bought Xinja?
The scope of APRA's investigation includes the period in which Xinja announced it had secured a $433 million deal with the Middle Eastern group, World Investments, that was branded as the “largest single investment in an Australian neobank or start-up”.
What has happened to Xinja?
Xinja burned through about $98.4 million in shareholder capital by offering some of the highest deposit rates in Australia while failing to offer a loan product that would earn sufficient revenue to sustain the operation. This was a failure of Banking 101.
Who started Xinja?
Eric Wilson, the founder of the company formerly known as Xinja Bank, has resigned from the board. Xinja, which now trades under the name A.C.N. 618 937 054 notified ASIC last week that Wilson was no longer a director of the company.
Is Xinja closing?
There must be lots of soul-searching going on inside the walls of the Australian Prudential Regulation Authority following the sudden closure of high-profile neobank, Xinja Bank.
What has happened to Xinja Bank?
Following what it called “a review of the market”, Xinja announced it will withdraw its bank account and Stash savings account, and stop operating as a bank. Instead, it will “refocus the business”, in other areas, including its US share trading product Dabble.
Who is Xinja owned by?
Xinja was founded in 2017 by CEO Eric Wilson. The business began in fintech, offering products like prepaid cards and a money management app. In 2018, Xinja raised money via crowdfunding to develop its neobanking facilities.