Volt Bank

» see voltbank.com.au as it lived, on the wayback machine

~ the obituary ~

Australia decided in 2018 to let software companies become banks, and built a two-stage ladder to do it: a restricted license to prove you could hold deposits without breaking anything, then a full one. On 7 May 2018 the regulator handed the first restricted license ever issued to Volt, a Sydney startup founded the year before by Steve Weston and Luke Bunbury. On 21 January 2019 Volt cleared the second stage and became a real bank.

Then nothing much happened for three years. Volt had the license and a savings account, plus a plan to sell its banking infrastructure to other companies as a service. What it did not have was scale. At the end it held about A$113 million in deposits from roughly 6,000 customers, which is a rounding error against any of the four big Australian banks it was supposed to be disrupting.

Volt tried to raise A$200 million in February 2022. The round did not close. On 29 June 2022 the company emailed its customers to say it was shutting the deposit business and returning the license, gave them until 5 July to move their money out, and made 140 people redundant. The mortgage book, about A$80 million of it, was sold.

~ the case file ~

~ how it landed ~

Australian neobanking in 2018 looked like a genuine opening. Four banks controlled the market, the regulator was actively inviting challengers, and the UK had already produced Monzo and Starling as proof the model could work. Volt, Xinja, 86 400 and Judo all came through the same door within about eighteen months of each other.

By late 2022 that cohort was gone in every direction except one. Xinja had already returned its license in December 2020, after a Dubai investment that never arrived, and 86 400 was bought by NAB, which is a good outcome that still ends with the brand switched off. The survivor is Judo, the business lender, and it survived by never pretending retail deposits were the point.

~ the funny part ~

Volt spent its last two years not really selling to consumers at all. The pitch had shifted to banking-as-a-service: let Volt hold the license and the compliance burden while somebody else puts their brand on the app. It signed partners and it built the platform, and that is a defensible business except for the part where you need funding to survive until the partners generate revenue.

~ the last six days ~

Nobody had to be rescued. Volt notified the regulator, the regulator watched the deposits go back, and A$113 million of other people's money walked out the door to other banks over six days without a queue forming outside a branch. A bank that closes without a run on it is doing the shutdown correctly, and it is worth saying so, because most of the entries on this site went out messier with far less at stake.

voltbank.com.au stopped resolving. The word neobank, which every Australian business paper used constantly between 2018 and 2021, mostly stopped being printed shortly after.

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