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Digital bank in1Bank – a neo-lender that offers personal banking, business banking, and home loans – has announced that it is to cease banking activities.
First established in 2019 with a restricted banking licence, the Chinese-founded neobank gained a full banking licence in 2023.
As at November 2025, the bank had just $3 million of household loans on its books, according to prudential figures, and $19 million in cash deposits.
However, on Thursday (22 January), the bank revealed that it had decided to discontinue its banking business. The reason for the closure has not been disclosed.
“As part of this decision, in1Bank will return customer deposits and effectively hand back its Authorised Deposit-taking Institution (ADI) licence once customer deposits are returned,” it said in a statement.
Customers of in1Bank are now being urged to confirm their alternative bank account details within 24 hours to ensure a smooth transfer of funds.
From 23 January 2026, in1Bank will begin transferring balances to confirmed accounts, with all accounts set to close and the app decommissioned by 5 February 2026.
The bank reassured customers that “funds are completely safe, and you have access to them” and added that deposits are covered up to $250,000 per account holder under the government-backed Financial Claims Scheme.
“Please be assured that your funds will remain safe at all times. To ensure a smooth process you must ensure that your alternative bank account details are confirmed within next 24 hours,” in1Bank said in a statement.
Customers with recurring payments or payroll arrangements have been advised to cancel these and provide updated details to avoid payment issues. Those with existing loans will continue on the same terms, with options to transfer offset balances to reduce loan balances or move them to another account.
Transfers of funds to alternative accounts will take place between 23 January and 5 February, with account closures and final statements issued on 5 February.
From this date, payment facilities through the in1Bank app will no longer be operational.
The Australian Prudential Regulation Authority (APRA) has noted the bank’s decision and said it “will closely monitor the return of deposits to ensure funds are returned to in1Bank depositors in an orderly and timely manner.”
APRA noted that the decision to relinquish in1Bank’s ADI licence “has been taken by in1Bank” and reiterated that depositors remain protected under the Financial Claims Scheme during the return of deposits process.
The bank is the latest neobank to fold, showcasing the difficulties that new entrants have in setting up in Australia.
Neobanks, once touted as the new disruptors of the banking industry, have almost disappeared from the landscape in recent years.
Volt Bank closed in 2022 with 5,730 customers and $107 million in deposits, with its customers moved over to Resimac.
Volt Bank had launched a savings account, but its long-awaited mortgage was still in pilot mode.
In 2020, Xinja Bank completed its return of customer deposits and transferred the remaining tail of deposits to National Australia Bank (NAB) after making the shock announcement that it would hand back its banking licence and cease offering banking products.
At the time of the announcement, Xinja had 37,884 customers with 54,357 individual deposits worth more than $252 million.
Following Xinja’s exit, APRA brought in “stronger requirements” for those wishing to be granted a banking licence.
New banking entrants now need to launch both an income-generating asset product and a deposit product before they can secure a full licence, under APRA’s new standards.
Before a bank can even gain a restricted ADI (RADI) licence, new entrants will need to present a business plan, as well as a plan to meet the prudential framework for new ADIs within a period of two years, including launch of products, and a contingency plan, which includes at least one option to execute an orderly and solvent exit from banking.
More to come.