Digital bank Volt has secured $15 million in funding from the Australian Finance Group (AFG) through a partnership agreement, AFG announced.
The funding is part of Volt’s extended series E round with a target amount of $85 million. AFG will hold a 7.6% stake in Volt after the investment.
As part of the agreement, Volt will enable AFG to access its banking services and products. It will also allow white-labelling of its personal finance manager application. Additionally, Volt’s direct customers who fail to fit its credit criteria will be referred to AFG for fulfilment upon consent.
“The management of financial services is no longer the domain of a handful of large institutions,” Volt founder and Chief Executive Officer Steve Weston said.
“Volt wants to facilitate a future where a range of businesses, large and small, can deepen their customer relationships by supporting financial journeys.”
“Volt has distinguished itself by pursuing a Banking as a Service model. The partnership with AFG is testament to demand integrated and white label banking to improve customer relationships,” he added.
The bank’s white-labelled digital mortgage product and AFG branded PFM app are expected to launch in the first quarter of 2022 for AFG brokers.
AFG CEO David Bailey is hopeful that the integration will help both companies harness each other’s potential. “Partnership will deliver value to both companies as we combine Volt’s Banking as a Service platform with AFG’s broker technology. This will create a significant distribution footprint to deliver competitive products and streamlined digital solutions for brokers and their customers.”
Ex- HSBC Chair joins Volt
The former chairman of HSBC Bank Australia, Graham Bradley, will join Volt’s board as chairman in June. Mr Bradley was also the president of the Business Council of Australia.
“The Volt team has successfully navigated the COVID disruptions of 2020 with their Banking as a Service strategy intact. With the new partnership with AFG and additional capital funding, Volt is well-positioned to scale up and provide efficient and competitive financial services in Australia,” Mr Bradley said.
The current chairman, John Masters, will become deputy chairman and chair the Volt audit committee. Four-year-old Volt started as a restricted Authorised deposit-taking institution (ADI). It could only accept a maximum of AU$2 million in total deposits. Later in 2019, it was granted a full banking license.
The digital bank also entered into a partnership with tech-giant Microsoft to develop the next updated version of its Banking as a Service (BaaS) platform in September 2020.