Outpacing Australia’s market-leaders with ultra-fast, AI-powered banking services
Brisbane, Australia
At a Glance
• 2 mins 40 seconds to provide loan decisions, significantly faster than domestic competitors
• 4.8 out of 5 Trustpilot TrustScore, far exceeding the banking category average of 3.4 out of 5
• 2100% growth in deposit portfolio and 66% growth in lending portfolio since ADI issued in December 2022
With offices in Sydney and Brisbane, Alex Bank is a 100 percent digital challenger bank, committed to providing customers in Australia with faster, fairer, and more flexible financial solutions. Alex Bank serves individuals and small businesses across the country with a range of retail and commercial banking products.
Simon Beitz, CEO of Alex Bank, takes up the story: “Our domestic market is dominated by four banks with a combined market share of around 85 percent. We surveyed 2,500 prospective customers about their frustrations with their current banks. We found that one of the biggest pain points was slow service. With legacy banks, applications for savings accounts, loans, and mortgages can often take several weeks to complete. We saw an opportunity to shape higher-quality retail and commercial banking experiences by removing the friction from these journeys.”
Targeting the optimal core banking platform
As a newly authorized deposit-taking institution (ADI) licensed by the Australian Prudential Regulatory Authority (APRA), Alex Bank looked for the optimal technology stack to help it deliver outstanding customer experiences. Compliant, always-on digital services were a must, and the bank targeted a core banking platform that could support its long-term goals.
“We want to be the most efficient bank in Australia, with a cost-to-income ratio of 30 percent or lower. To deliver seamless digital services to thousands of customers with a lean team of just 38 people, we knew we had to develop highly automated systems and processes. Choosing the optimal core banking platform would be a key enabler of this strategy, and we set out to find the right partner.”
Simon Beitz, CEO of Alex Bank
Building a platform for service innovation
To lay the foundation for next-generation services, Alex Bank selected Temenos core banking on Temenos SaaS, deployed on a resilient and highly available platform.
“We evaluated potential vendors against several criteria, including industry experience, access to support, and a proven track record of successful deployments,” recalls Beitz. “Temenos met all our operational and technical requirements for a new core banking platform. As well as having global reach, Temenos has a very strong footprint in Australia, which gave us the confidence we could get effective support whenever we needed it. Temenos core banking can be customized flexibly and deployed rapidly, which allows us to address stringent regulatory requirements without sacrificing our challenger bank agility.”
Accelerating deployment, reducing costs
By deploying Temenos core banking on SaaS, Alex Bank accelerated its core banking implementation while avoiding the significant capital and operational costs associated with deploying an on-premises infrastructure.
Beitz elaborates: “Temenos SaaS offers us many advantages over an on-premises approach. With managed services from Temenos, we are free from the burden of maintaining our infrastructure, which empowers staff to add value in other areas of the business. We can also scale Temenos core banking quickly and easily as we grow—a big advantage for a challenger bank. Crucially, Temenos SaaS offers us mature security and high availability capabilities, giving us the peace of mind that our organization and our customers are always protected.”
Unlocking vital insights
Working with an expert team from Temenos, Alex Bank leveraged the solution’s built-in tools to tailor its banking products to meet the needs and expectations of its target market, and to design Temenos Analytics reports to deliver business insights to management and leadership teams.
“We can modify business rules in Temenos Financial Crime Mitigation with minimal support from Temenos, saving time and effort and helping us to keep pace with the needs of the business.”
Rocketing ahead in the Australian market
Through its collaboration with Temenos, Alex Bank is rapidly establishing itself as one of Australia’s fastest-growing financial organizations.
“Our goal isn’t simply to offer slightly faster services than our banking competitors. We want to deliver experiences that match the speed and convenience of our customers’ favorite brands — for example, e-commerce retailers. To realize our vision, we’ve designed every stage of every journey with the customer experience at the center.”
Simon Beitz, CEO of Alex Bank
“Our goal isn’t simply to offer slightly faster services than our banking competitors,” explains Beitz. “We want to deliver experiences that match the speed and convenience of our customers’ favorite brands — for example, e-commerce retailers. To realize our vision, we’ve designed every stage of every journey with the customer experience at the center.”
Providing decisions in seconds
By combining the capabilities of Temenos core banking with its own AI technologies, the bank is delivering lending decisions and onboarding customers within minutes, speeding ahead of its competitors.
“We have created a smart, real-time credit decisioning system called Alex Intelligence™, which uses data analytics to accurately assess an applicant’s credit risk,” explains Beitz. “For unsecured loans, we’ve compressed the entire customer application process down to two minutes and 40 seconds. When a customer applies via their digital device, we can give them a decision significantly faster than our competitors and deposit the monies to their account within as little as three hours. We’ve since expanded to secured personal loans, and next we plan to build a similar offering for small business owners.”
Nurturing customer loyalty
Alex Bank’s relentless focus on the customer experience is already paying dividends. The organization is racing ahead of its competitors with a Trustpilot TrustScore of 4.8/5, far exceeding the banking category average of 3.4/5.
“We are now measuring a satisfaction score of 81.7/100 on Trustpilot, which shows that our approach is really resonating with our customers,” says Beitz. “Our growth trajectory is so steep that we’re often breaking our own daily records for new lending and deposits. Since ADI issued in 21DEC22, deposits have increased by 2100 percent and lending has grown by 66 percent. These results contributed to Alex Bank receiving Fast Starter awards from both Deloitte and the Australian Financial Review.”
Planning for the future
Looking ahead, Alex Bank plans to work with Temenos to bring its mortgage offering for small business owners to market, and the bank expects to achieve profitable operations within a matter of months.
“We have high expectations of Temenos, and Temenos continues to meet those expectations by helping us get innovative products to market rapidly. Having Temenos as our core banking partner is integral to delivering excellent customer experiences and staying ahead in a highly competitive industry. We’re excited to build on what we’ve achieved with Temenos core banking on SaaS.”
Simon Beitz, CEO of Alex Bank