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Airwallex launches interest-bearing greenback account

Technology

In a claimed first for Australia, US dollar balances in Yield earn interest at “double the rates of the big banks”.

By Philip King 10 minute read

Payments platform Airwallex has launched an account that pays interest on US and Australian dollar balances at “double the rates of the big banks”.

It said the account allowed businesses to earn returns on surplus funds and then move the money without lock-up periods or term deposit restrictions.

Called Yield, it claimed an “Australian first” in eliminating the need to open an overseas account to earn a return on US dollar balances.

Airwallex Australia and New Zealand managing director Luke Latham said Yield would be offered to customers meeting a minimum initial investment threshold before the product was rolled out to other markets and with additional currencies next year.

“Interest rates have picked up significantly, and we want to help our customers do more with funds that might be sitting idle in their accounts,” Mr Latham said.

“Yield means Australian businesses can earn a return on their surplus funds in Australian dollars and US dollars and that they can escape the status quo that’s limited to banks locking up their funds with no flexibility and offering anaemic returns.”

Mr Latham said Yield offered benefits in a wide range of situations.

“The current system leaves many businesses at a disadvantage, from the companies which raise money in US dollars and have no option in Australia right now to earn returns on those funds without converting them to Australian dollars, to the businesses struggling with unexpected cash flow needs while funds are locked in a term deposit account, or those companies with funds sitting idle between sales season and the next round of inventory orders,” he said.

Airwallex said Yield would pay 3.39 per cent on Australian dollar balances and 4.07 per cent for US dollar balances, calculated daily, compared with an average of 1.38-1.5 per cent for business saver accounts with big banks. The Yield account is integrated with the Airwallex app and funds can be accessed at any time without fees, typically taking one or two business days to reach the business’s cash balance.

During the launch period, Australian entities would need a minimum of $500,000 (or US equivalent) to open a Yield account but Airwallex is planning to make the product available “regardless of investment size”.

Airwallex co-founder and CEO Jack Zhang said the company wanted to take the friction out of financial operations and help manage cash flows for businesses.

“From payments, treasury and spend management and now returns through Yield, Airwallex will keep expanding into new areas because incumbent banks are letting businesses down,” Mr Zhang said.

Since launching in Melbourne in 2015, Airwallex has become a global business financial platform with 100,000 customers.

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Philip King

Philip King

AUTHOR

Philip King is editor of Accountants Daily and SMSF Adviser, the leading sources of news, insight, and educational content for professionals in the accounting and SMSF sectors.

Philip joined the titles in March 2022 and brings extensive experience from a variety of roles at The Australian national broadsheet daily, most recently as motoring editor. His background also takes in spells on diverse consumer and trade magazines.

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