Two new banks set to take on the big four

Commonwealth Bank, Westpac, National Australia Bank (NAB) and ANZ Bank dominate Australian lending and banking with more than 80 per cent of the market between them. 

The big four Australian banks often face criticism that they lack sufficient competition and take their customers for granted. Now they face new competition from two new entrants currently waiting for banking license approvals. 

Firstmac, the owners of loans.com.au, and 86 400, a spin-off from the credit union service company Cuscal, have applied to the government for registration as a bank. 

Both of them are waiting for the outcome of the federal election on 18 May before the new treasurer,  presumably either Labor’s Chris Bowen or the Liberal’s Josh Frydenberg, is expected to approve their license applications.  

Members of Queensland credit union MCU Ltd have voted overwhelmingly to accept a takeover offer by Firstmac. This takeover would give Firstmac, an ambitious Brisbane-based mortgage funder, access to the retail banking market and deposit and transaction banking. 

Robert Bell, CEO of 86 400, told Banking Day that he plans to sell $2 billion in mortgages. 

“We’ll be very competitive on rates and fees.”