Xinja has taken the “unprecedented” step of stopping the opening of new Stash accounts rather than lowering the interest rate paid to existing customers following the latest RBA cut.
“Because these are uncertain times for everyone, we’re keeping our rate steady at 2.25 percent, but we’re hitting the pause button when customers open Stash accounts,” said Eric Wilson, founder and CEO of Xinja.
“The absence of new Stash accounts means there will be no increase in costs for Xinja and we can protect the interest rate for people who already have a Stash account. »
This announcement comes as Xinja experienced “the two most important days in its history”. The neobank only recently began rolling out its new Stash account and was targeting $1 billion in deposits by the end of the year after historically low rates sparked a $200 million rush of funds into the start-up in less than a month.
“Faced with higher-than-expected deposit flows and an RBA rate cut, most banks would simply cut interest rates on deposits, hurting existing customers while seeking new ones,” Mr. Wilson wrote.
“That is not the purpose of Xinja.”
The neobank is also preparing to launch a lending product later this year.
