Airwallex, the Australian-founded leading financial platform for modern businesses, has become the first major payments company to receive an Australian Financial Services License (AFSL) from the Australian Securities and Investment Commission (ASIC) to provide businesses with access to retail investment products.
This is an additional license from AFSL, which Airwallex has held since 2016 for its existing payments and foreign exchange business.
The regulator’s approval formalizes Airwallex’s entry into investment products and signals the company’s evolution towards an end-to-end financial services platform.
The announcement comes just eight months after Airwallex launched Airwallex Yield for wholesale customers, allowing them to earn attractive returns on their AUD and USD balances without having to open an overseas bank account – a first in Australia.
With this expansion, Airwallex Yield will be offered to the broader retail market starting today – with a lower minimum investment of AUD$10,000 (or USD equivalent).
The expanded Airwallex Yield offering allows customers to:
- Invest with a minimum investment amount of AUD 10,000 (or USD equivalent);
- Invest in funds that have historically paid more than three times the interest rates of savings accounts from the big four banks; currently a daily return of 3.67 percent for AUD balances and 3.95 percent for USD balances (compared to 1.06 percent pa and 0.50 percent pa* respectively) and;
- Avoid lock-up periods and, unlike time deposits, easily move funds between your cash balance and your investment account.
- Airwallex Yield allows clients to invest in a product that invests through a fund managed by JP Morgan Asset Management (JP Morgan), one of the most trusted asset management firms in the world. JP Morgan’s underlying funds have the highest rating from Standard & Poor’s of “AAAm” and equally high ratings from all leading rating agencies.
- Since its launch, Airwallex Yield has been available to businesses with a minimum investment of A$500,000 or the US dollar equivalent. To date, Airwallex Capital Pty Ltd has raised over A$100 million in client funds under management.
Airwallex Yield has been designed to be a competitive alternative for businesses as its yields track the RBA cash rate more closely than interest rates offered by traditional providers – a priority in this current high inflation environment. Companies could earn more than three times the amount of a savings account at one of the big four banks by investing with Yield. Yield’s underlying fund, the JPMorgan Liquidity Fund, offers a daily return of 3.67 percent on AUD balances and 3.95 percent on USD balances, compared to an average of 1.06 percent per year for business savings accounts at major banks for AUD and 0.50 percent per year for US DOLLAR*.
Shannon Scott, SVP of Product at Airwallex, said the company is excited to expand Yield to help companies benefit from greater flexibility and returns, especially in the current economic climate.
“We are excited to expand Yield and position Airwallex as a modern alternative to banks for businesses of all sizes. This move into investment products underlines our role as a comprehensive financial services platform that can help companies manage their finances more efficiently.
“This is particularly timely as Australian SMEs face economic challenges and rising costs. Yield offers them flexibility, attractive returns and the option of multiple currencies – a solution that companies have been looking for for years.”
George Boubouras, Managing Director, Research, Investments & Advisory at K2 Asset Management Ltd (an Airwallex partner and issuer of the Yield product), said: “Companies trading across borders can benefit from exposure to money market funds, which are currently benefiting from higher returns due to the higher Fed Funds rate in the US and domestically due to the higher RBA rate.
“The benefits of a multi-currency mixed cash account, which provides access to multiple currencies in a single account, can result in lower transaction costs and faster settlement times compared to traditional currency accounts, which offer lower returns and represent a greater burden.”
Also commenting on the news, Matthew Le, Head of South East Asia & Australia Sales, Global Liquidity, JP Morgan Asset Management, said: “JP Morgan Asset Management is pleased to partner with Airwallex. As a leading wealth management company, we have invested in our technology to evolve and meet the needs of financial services providers and the growing demands of today’s customers.”