WTF is the ACCC?

The ACCC (Australian Competition and Consumer Commission) is the competition watchdog in Australia. They make sure all is good in the competition-hood. No price-fixing, no illegal mergers, good competition in the market.

And now, the ACCC is investigating whether to allow NAB's $220m takeover of Aussie neobank 86 400 - the new neobank to hit the Aussie banking scene. I know what you're thinking - how did they come up with the tongue-twister 86400 - apparently it's the number of seconds in the day.

The deal would see 86400 merge with NAB's existing online bank, UBank.

But now, the ACCC wants to make sure we all play fairly in our economic sandbox, is saying, ‘hey big banks.. We have our eyes on you’. That’s a direct warning to banks that are interested in gobbling up emerging fintechs and digital banks like a PacMan.

A decision on the merger is due in April but the ACCC is really keen to understand if 86 400 'plays a critical role in the market' and whether it is uniquely placed to provide significant competition.

So what's the key learning?

The ACCC wants to protect neobanks — and their customers — from the extremely well-capitalised and acquisition-hungry big four banks. Get this - more than 80 per cent of mortgage borrowers have a loan with one of the Big 4.

The concern is that once a big bank (ahem, NAB) buys a smaller but upcoming bank (86399), they will ensure that NOBODY is undercutting them. And this will reduce the competition in the market - ultimately affecting price and service for all of us.