Airwallex, a financial platform for businesses, has been granted an Australian Financial Services Licence (AFSL) by the Australian Securities and Investment Commission (ASIC) to offer retail investment products.
This licence is in addition to the AFSL that Airwallex has held for its payments and foreign exchange business since 2016.
The new authorisation marks Airwallex’s move into the investment products market and reflects its aim to become a comprehensive financial services platform. The announcement comes eight months after Airwallex launched Airwallex Yield to wholesale customers, enabling them to earn returns on their AUD and USD balances without opening a foreign bank account – a first in Australia.
With the expansion, Airwallex Yield will be available to the broader retail market, with a lower minimum investment requirement of AUD$10,000 (or USD equivalent).
The expanded offering allows customers to:
- Invest with a minimum amount of AUD$10,000 (or USD equivalent).
- Access funds that have historically returned more than triple the interest rates of saver accounts from the big four banks, currently offering a daily return of 3.67 per cent for AUD balances and 3.95 per cent for USD balances.
- Move funds between their cash wallet balances and Yield account without lock-up periods, unlike traditional term deposits.
Airwallex Yield invests through a fund managed by J.P. Morgan Asset Management, whose underlying funds hold high ratings from leading rating agencies.
“We’re excited to expand upon Yield to position Airwallex as the modern alternative to banks for businesses of all sizes,” said Shannon Scott, SVP of product at Airwallex. “This move into investment products underscores our role as a comprehensive financial services platform that can help businesses manage their finances more efficiently.
“It’s especially timely as Australian SMEs face economic challenges and rising costs. Yield empowers them with its flexibility, attractive rates of return and multi-currency capabilities – a solution businesses have been craving for years.”
Also commenting on the news, George Boubouras, managing director, research, investments and advisory at K2 Asset Management Ltd (an Airwallex partner and issuer of the Yield product), said: “Cross-border trading companies can benefit from exposure to money market funds that are currently taking advantage of the higher yields on offer due to the higher Fed Funds cash rate in the US and domestically the higher cash rate set by the RBA.
“The benefits of a blended single multi-currency cash account that offers exposure to multiple currencies in a single account can assist with lower transaction costs and shorter settlement times compared to traditional currency accounts that offer lower yields and are more burdensome.”