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Term Deposit Target Market Determination

Last updated 17 January, 2023

Issuer

Alex Bank Pty Ltd ABN 13 627 244 848, Australian Financial Services Licence and Australian Credit Licence 510805 (Alex, We, Us or Our).

Target Market

This Target Market Determination (TMD) sets out the target market for our Term Deposit product.

Product Description and Key Attributes

The Term Deposit key attributes that will impact whether it is likely to be appropriate for the target market include:

  • an agreed fixed interest rate based on the fixed term, the interest payment frequency and the amount invested;
  • no establishment or ongoing monthly fees;
  • the ability to choose an interest payment frequency based on the need for regular interest income;
  • the ability to provide maturity instructions to payout or reinvest the deposit on the maturity date; and
  • the inability to withdraw the deposit during the fixed term without providing 31 days’ advance notice and an interest adjustment applies. In cases of financial hardship, the notice period may be waived by Us where the customer can evidence true hardship.
Description of objectives, needs and financial situation

This product is appropriate for a customer with the following likely objectives, needs and financial situation, including a customer:

  • with a need to deposit money with a Bank;
  • who wants to choose the duration of their deposit (the ‘fixed term’);
  • who wants to choose the interest payment frequency on their deposit;
  • who wants the certainty of a fixed interest rate on their money;
  • who has sufficient financial means to not require access to their money for the fixed term;
  • who does not want to pay any upfront or ongoing monthly fees to Alex for the fixed term;
  • who does not require withdrawals, transaction capability or at-call access to the deposit during the fixed term;
  • who is comfortable that should their circumstances change during the fixed term necessitating an early withdrawal of the deposit, at least 31 days’ advance notice must be provided to Alex and an interest adjustment will apply; and
  • who is comfortable to receive all customer notices electronically issued directly from Alex or via their deposit intermediary.

This product is not suitable for a customer that:

  • does not want to lock their money away for a fixed term;
  • does not want to earn interest;
  • anticipates a need to access their money during the fixed term;
  • wants to earn a variable interest rate;
  • wants the flexibility to transact regularly through deposits, withdrawals or via a debit card;
  • needs the deposit to act as security for a lending obligation;
  • needs an authorised representative to act on their behalf with access to Alex Electronic Banking. No online access is supported for appointed attorneys, advisors or other representatives; and
  • does not have basic digital access, for example access to email for purposes of receiving all customer communications.
Description of Customer Profile

This product is only available to customers that meet Alex identification requirements and are:

  • Personal customers
    • 18 years or older;
    • An Australian Citizen or Australian Permanent Resident for tax purposes; and
    • Residing in Australia at the time of the application
  • Non-personal customers
    • Operating as a sole trader, company, registered self-managed superannuation fund or trust registered in Australia with an ABN or ACN.

The Alex Term Deposit is subject to our Term Deposit Terms and Conditions, available at www.alex.bank.

The product is appropriate for the target market on the basis that the key attributes of the product as set out in this determination address the objectives, financial situation and needs of consumers in the target market.

Distribution Conditions

  • We have placed conditions and restrictions on the distribution of the product to ensure it is distributed to customers in the target market.
  • This product is primarily marketed and promoted through digital marketing and via Alex deposit intermediaries involved in arranging for customers to access the product.
  • These distribution conditions are appropriate given the scope of the target market and eligibility criteria.
  • If we become aware that the distribution conditions are inadequate, where for example, significant distribution is occurring outside the target market, Alex will undertake a review of this TMD.

Review Triggers

  • The events or circumstances (‘review triggers’) that would reasonably suggest that the TMD is no longer appropriate and would trigger its review are:
    • invitations made to customers from outside the target market;
    • significant dealings meaning a material pattern of dealings in the product or distribution conduct that is inconsistent with the determination;
    • a material change to the product including the introduction of promotional features;
    • a material change in law or regulatory guidance;
    • reporting from distributors that suggests the TMD is no longer appropriate;
    • internal complaints or notice of complaints made to the Australian Financial Complaints Authority (AFCA), considering the nature and trend of the complaint(s);
    • a notification from the Australian Securities and Investment Commission (ASIC) requiring immediate cessation of the product or particular conduct in relation to the product.

We will review this TMD within 10 business days if we know or reasonably know, that a review trigger has occurred.

Review Periods

First Review Date: 1 December 2023

  • Periodic Review: Subsequent periodic reviews will occur at least annually.
  • We will also review this TMD in response to any review triggers or other events or circumstances that would reasonably suggest that this TMD is no longer appropriate.
  • We will notify ASIC within 10 business days of us becoming aware of a significant dealing in the product that is not consistent with this TMD.
  • We will integrate the review process into our product governance arrangements, and controls will be put in place to ensure that meaningful reviews take place. Possible outcomes from the review process include:
    • no change to the way the product is distributed; or
    • changing the product design, target market or distribution.

Distribution Information Reporting Requirements

  • We understand complaints and general feedback about the product are useful indicators of whether this TMD is still appropriate.
  • Where Alex engages deposit intermediaries to distribute this product, we require that they promptly provide us with information in relation to any complaints and general feedback received, to allow us to review this TMD.
  • Our deposit intermediaries are required to provide the following information:

Type of Information

Description

Reporting Period

Complaints 

The following information is required:

  1. Name
  2. Date of complaint
  3. Product
  4. Nature of the complaint
  5. AFCA status (if applicable)

Monthly within 10 business days of the month end

Significant Dealings

Information about any significant dealing in the product that is inconsistent with the target market determination of which the intermediary becomes aware.

As soon as practicable, and in any case within 10 business days after becoming aware.

Intermediary Feedback

Information discovered or held by the intermediary that suggests that the determination may no longer be appropriate.

As soon as practicable, and in any case within 10 business days after becoming aware.

Other Information Requested

The intermediary must provide the information by the date requested by Alex.

As soon as practicable, and in any case within 10 business days after the request.