Suncorp exec-founded neobank Alex banks $10m

But, he was hopeful the licence would be granted quickly once APRA resumed granting restricted licences from March next year.

"We're targeting bank-quality customers. Our driver is to be easier to deal with, have simple language, no jargon, and also fairer for customers through better rates and no hidden fees," he said.

"We've built technology in-house, partnered with large industry providers like GreenID and our core system is Temenos, while we built out the front-end experience.

"We have military-grade security, trusted systems and solutions that work."

The neobank business was founded in 2018 by Mr Beitz and his fellow Suncorp colleague Craig Fenwick. The pair realised it would be easier to build it outside of the bank, rather than in it.

It is the second start-up for Mr Beitz, who also co-founded EML Payments, but left the business in late 2004.

The proceeds of the capital raising, which was supported by the likes of Alium Capital Management and Brisbane-based Alvia Asset Partners, will go toward marketing expenses, as well as investing in its artificial intelligence algorithm, which enables it to make better lending decisions. In total, it's now raised $26 million in capital.

The company has also recently secured a new $10 million wholesale facility to support its loans.

"[In three to five years] we're well-placed to be a very strong competitor in the current banking landscape," Mr Beitz said.

"There's no big objective about trying to do something... the milestones are just to continue to accelerate and drive customer growth."

A 2019 report from Credit Suisse stated there was a $57 billion addressable market for Australian neobanks, but they were yet to make a dent on the incumbent banks.

For the new digital banks to have a shot at taking any meaningful share off the big banks, Credit Suisse said they would need to offer a "fundamentally different service" and additional services that add more value for customers.

Alex's target customer will be 18- to 30-year-olds who are comfortable with a fully-digital product and prefer not having to go to a branch.

While there's been a proliferation of neobanks in the local market in the last few years, Mr Beitz was not concerned about the competition.

"It's littered with businesses that have done well offshore, but haven't understood the local market," he said.

"We're focused on the local market and once we're a [licenced] neobank, we will be the only lending-led neobank.

"We don't see it as a crowded space. If you've thought through your strategy properly, there's plenty of blue sky in Australian banking."