Australia's newest bank, Tyro, has appointed the founder of National Australia Bank's UBank and Telstra Digital, Gerd Schenkel, as its new chief executive, in a sign the payments disrupter plans to ramp up its attack on the big banks' small business lending customers.
Mr Schenkel, who starts at Tyro next week, will replace Jost Stollmann, the existing CEO who will become a full-time executive director. Both men were born in Germany.
Tyro, which is in the process of building what it dubs a "Nextgen bank", recently hired tech entrepreneur Paul Peterson as its head of product and is searching for a new vice president of sales and marketing.
Over the past decade Tyro has lured 16,000 small business customers who use it to process payments. Tyro was granted a full banking licence by the Australian Prudential Regulation Authority in August last year, the first time a technology company has been granted an Australian banking licence.
To assist its growth, Tyro raised $100 million last year from prominent investors including Atlassian's Mike Cannon-Brookes, who sits on the board, and Tiger Global, a New York tech investor that counts Facebook and LinkedIn among its early-stage investments.
Huge opportunities ahead
"The opportunity for Tyro is huge because the pain points of small business banking are huge. We have to remove the frictions of banking," Mr Stollmann said on Wednesday. "We need to be fast-growing to crack this and to do that we need the best talent."
Mr Schenkel founded Australia's first digital bank, UBank, in 2008, which has about $20 billion in customer balances and is owned by National Australia Bank. He was also the executive director and founder of Telstra Digital.
"Tyro is a new kind of company with a uniquely attractive culture, it's a technology company that happens to be a bank, not the other way around," he said. "Australia needs a viable and strong banking sector which is customer centric and technology literate, a Tyro delivering fair, transparent and smart banking."
Tyro processed $8.6 billion of transactions and generated more than $95 million in revenue in the full 2016 year.
In a recent report, Tyro said inefficiencies in small business banking were costing the national economy almost $7 billion each year and almost half of Australia's 2 million SMEs spent more than three hours every week checking, entering, paying and reconciling data with banks.
Tyro has been a vocal critic of the power of Australia's banking oligopoly and has taken a leading advocacy position calling for "open data APIs" to be mandated, and for the comprehensive credit reporting regime to be accelerated. It says both policies will allow competitors to the banks to access more customer data from incumbents and therefore be better able to offer better deals.
