Xinja Bank may have a heck of a story and outlive its troubles, but from the outside a disorderly exit from the banking industry looms.
Ordered to lower standards for banking entry and opposed from the outset, APRA is playing by the big bank, system stability rule book now.
APRA set up neobanks to fail and there will be few tears at the regulator if and when Xinja Bank falls, as seems likely.
Counting PayPal and Cotton On as new partners, Volt Bank is one neo engineering its survival though this cannot be assured. Xinja Bank's wandering places every neobank under question like never before.
Judo Bank, digging for gold in the SME and term deposit segments, has just banked another A$400 million in capital, call it $1 billion in capital overall.
It's the kiddies' pool for the rest, almost all other neobanks seeking capital at present.
"We've raised more than $100 million," Steve Weston, CEO of Volt Bank reminded Banking Day.
There is no APRA runaround for Volt Bank on a par with the regulators' trusteeship, more or less, imposed on Xinja Bank. Weston scoffed at this theory in our interview.
"Our interest rate is 2.15% p.a. (variable). There are no hoops, hurdles, tricks or conditions designed to stop you getting that rate," reads the Volt pitch at the front of its website.
"It is what it is. 2.15% p.a. on every dollar up to $245,000."
This is $5000 below the cap on the Financial Claims Scheme. Is this a Volt Bank board idea, or APRA's work?
Neobanks are on a leash and Volt and 86 400 will need to draw on a lot of nerve to ride out the Xinja crisis.
"When your assets grow above a certain level, you need more capital," Weston said, rejecting the idea APRA leaned on Volt Bank to recapitalise in a hurry.
"We have capital targets, we try to stay above those. We follow the standardised model which applies to all but the biggest banks," he said.
"Our savings account has 40,000 people on the waitlist. We only just finished; you ask people to help with design."
"Volt is a disruptive product, getting rid of introductory rates," a confident Weston told Banking Day.
Weston would not buy into the idea that Volt, a lot like Xinja (and 86 400), is running deposit pricing at unsustainable levels, probably 60 basis points beyond what the bank's shareholders can afford.
Kerosene might as well be the chief ingredient in neobank land.
Backtracking on the rates promise, dismaying customers or any form of pivot, Weston was having none of this talk and for now Volt has company,
Over at 86 400 the boast is of a "market-leading rate on up to $300,000.
"Earn 2.25% p.a. on up to 3 Save accounts (balances up to $100,000 per account) when you deposit $1,000+ per month into any of your Pay and Save accounts. This variable rate is made up of 0.40% p.a. base plus 1.85% p.a. bonus," 86 400 pitch.
2.25 per cent - that's what Xinja could not afford to pay so how can 86 400?
Back at Volt, a cash management trust substitute is one promising product waiting for the best moment and enough capital to take its chances in the market.
"We are a wholesale bank with a banking platform," is one way Steve Weston likes to differentiate Volt.
"There is a gap between us and ING" - by 20 bps - "but our overall our financing costs [will fall] when we announce more partners soon."