Neobank 86 400 is continuing to fine tune its deposit product set by expanding the transactional functionality of its flagship savings product, the Save account.
In a move likely to be imitated by other deposit takers, 86 400 is allowing customers to make payments directly from their high interest accounts.
The innovation, which eliminates the obligation on savers to transfer cash to separate accounts each time they want to transact could trigger an industry-wide shift to hybrid products in the bonus saver market.
Apart from simplifying the banking experience, it also threatens to further crunch the fees that established banks collect from customers who are forced by current industry practices to hold multiple accounts.
Travis Tyler, 86 400’s head of product and marketing, believes the addition of transactional capability to the savings account will be a game-changing feature in the deposit market.
“Whether customers need to schedule rent, BPAY a phone bill, send money to a mate’s PayID, or direct debit their electricity bill, they can now do it all from their 86 400 Save account,” he said.
“This means Aussies will no longer have to choose between having money available to make regular payments and locking it away to earn interest.
“People should no longer feel that they have to choose between convenience and getting a high interest rate when selecting an account.”
Tyler said that adding transactional capability to the savings product would have no implications for 86 400 in terms of how Save account deposits were classified by APRA for regulatory capital treatment.
Official data published yesterday by the banking regulator shows that 86 400 expanded its retail deposit base by A$20 million in August to $362 million.
Since the start of January, the bank has attracted more than $250 million in fresh deposits.
Neobank rival, Xinja, grew its deposit book by $6 million to $468 million in July, while Volt Bank’s holding of deposits rose by $15 million to $60 million.
With an interest offer of 1.65 per cent, Xinja continues to maintain price leadership in the savings market, shading 86 400 and UBank that both offer 1.6 per cent.
Volt recently lowered its interest offer to 1.45 per cent.