Asking Permission
Forgive me, if this comes across as financially privileged, but this week's experience opening a business bank account in Australia was a shit-show. Yup. A full-on shit-show.
Why?
Let's dive in.
The task in hand was simple: setup a business bank account for day-to-day transactions. Ok. Well who do I go with? Time to get a recommendation. I reached out to some friends who operate in the same niche as me, they had multiple stories of difficulties, but I got a few banks to apply to.
First off I thought I would try the bank I use for my personal accounts, Westpac. After a brief search on their website, it was evident I couldn't, as I had to go to a branch. As a digitally savy entrepreneur, I have a strong preference for a slick online experience. If you can't even sign-up online, what will the service be like later down the line? I did try and call the local branch, to see if I could arrange a time to come in, but no answer, and unsurprisingly, no call back...
Is it too much too ask to be able to open a new account digitally? In a world in which every essential service I receive, is available in some form online, why is banking exempt? This seems crazy to me. "Surely there are some other options!" I thought to myself. Well guess what...? The following banks require an in-person application:
I liked the sound of both of them, smaller, and potentially more motivated to take my business. But nope. "Sorry sir, we can't do that online or over the phone, you'll have to visit your local branch." Now given that the closest options were an hour away from where I live, I wasn't in a rush to do that. So who's next? Let's try some of the big guns of Australian banking.
ANZ were next up. What happened? Well it looked like everything was going well, when their onboarding process didn't recognise my new companies ACN. WTF? Why not? When you register a company with ASIC the regulator you get an Australian Company Number, which I knew ours to be correct, so how does it not recognise it? Try as I might, an answer wasn't easy to find...
You know that feeling of rising frustration as a keyboard warrior? Yup. We all get it. It was welling up inside me. Urgh... "WHY IS THIS PROCESS PROVING SO HARD!!!". Well, the best was yet to come... Next up I tried CommBank, Australia's largest bank, who turned out to be a proper false dawn. I onboarded fine, had some emails asking for additional information on the shareholder base, and was told that all was looking good.
"We'll get back to you in 1-2 business days." I even had a couple of friendly phone calls. "Hmm, this feels like a good service" I thought. Then boom. The long winded email, asking for lots of additional information on shareholders, who controls what, certified ID requirements, and a host of other things. Apparently being incorporated in Australia, with the regulator, is alone not enough to be a valid customer.
It reached a point where I just knew they were asking too much. "Is this really necessary?", as they were fishing for information on an overseas family trust with an indirect shareholding in the business. FFS. I've had enough. Surely there's a better way of doing this? I decided to try Macquarie. To be fair, they seemed fine, but needed something called an ABN which I had yet to apply for (yet more paperwork, this time with the ATO, the taxation department, who issue you an Australian Business Number).
By this stage I've spent hours of my time, a week has gone by, and I am still no closer to getting what I need. And the problem? I truly NEED this. How can a new business function properly without a bank account? Well there are 2 key twists to this tale to answer that. Let's deal with the first.
Enter stage left Revolut. Is this even a bank account? It looks excellent for international transfers. In any case, I thought I'd give it a crack, having had a great experience in the past on a personal level. The onboarding was a slick digital process. Sure they had some information they needed, which I was happy to share as it didn't feel like an over-reach, but I didn't feel overwhelmed. It felt like progress.
Within 4 hours of my initial application, a few additional logins, and a couple of failed attempts to register my co-director, we had an account. Boom! Thank you Revolut! After a week of effort, I now had a way to receive payments for our upcoming launch. Phew.
Now before I wrap this up, let me finish off the second point I touched on just then. The idea that we NEED a bank account to function. That is common wisdom. It feels true. But is it? Well the truth is it isn't. We could just use Bitcoin. We could insist on Bitcoin-only payments as income, and we could only work with people who will accept Bitcoin. The beauty of that? It's permission-less.
We live in a world in which everything we do in the financial world requires trust, we have to ask permission, and this business banking experience highlights that brilliantly. Bitcoin is the opposite. All you need is some knowledge, an internet connection, and you can send, receive, and store value. Bingo.
Now of course there are some nuances to all this. What if you want to pay for a subscription product that only accepts fiat? Well you probably need a bank account. What if you owe tax? Well you probably need a bank account. What if a customer doesn't want to pay in Bitcoin? Well you probably need a bank account. But the key is we now have an alternative.
Big breath. What a week! I feel a sense of contentment to have reached this point. Now one last point, which fuels the conspiracy within me: our company name has "Bitcoin" in it, could this be why the bank setup was so hard? Maybe. Probably. Very likely. The truth? We'll never know.
But what's certain, make damn sure you know who's playing field you're operating on. The permission-less, or the permission-ed...? You don't want to get caught offside. Ultimately, playing by the book doesn't mean you can't be an early adopter of a nascent technology.
Thanks for reading.
Best,
Jake "keyboard warrior now in chill mode" Woodhouse
Ps - have you ever experienced anything like this before? It's the kind of poor customer experience that is very common, but not often talked about. Indeed, it makes things abundantly clear that the banking sector is primed for disruption
