BRANSON OPENS THE DOORS FOR COMPETITION TO LEAVE AUSTRALIANS $10 BILLION BETTER OFF
Sydney, 27 July 2010
Sir Richard Branson today heralded a new era of competition for the Australian banking industry, when he launched the first phase of Virgin Money’s new range of banking products this morning.
Branson signalled Virgin Money’s intent to shift the balance of power away from the ‘Big Four’ banks, pointing out that if Australians exercised their right to choose better value banking products, they could collectively save more than $10 billion over 10 years1.
Speaking in Sydney this morning, he said, “Virgin Money is here to make all Australians better off. Today we’re launching the first in a range of new products starting with two credit cards and an online savings account – all of which are best in class. There is no better time to offer Australians a genuine alternative with simple and fairly priced banking products in an industry where there’s less competition today than ever before. This is classic Virgin territory,” he said.
New research conducted by Access Economics2 found that the average Australian household could save more than $40,000 over ten years if they exercised their right to choose the most competitive products on the market.
Richard Branson added, “Yes, Australia steered itself superbly through the Global Financial Crisis, but unfortunately this came at a price: the elimination of genuine choice. The finance sector in Australia has become highly consolidated and is now dominated by the Big Four, which results in the average Aussie getting less choice. Virgin Money is out to make a fair profit – not the most we can get away with. We’re here to shake up financial services in Australia as we’ve done in air travel.”
No stranger to taking on well-entrenched, dominant competitors in other industries, this launch represents Virgin’s largest commitment in Australia to date. Launched today, Virgin Money’s new products include:
- The Virgin Flyer Card – A credit card for Virgin flyers. Earn Velocity points when you spend to get you flying faster to over 400 destinations. What’s more, the card gives you 2-4-1 flights on Virgin Blue and those who sign up and use their card before 15 October 2010 will also get an additional free flight with Virgin Blue.
- The Virgin No Annual Fee Card – This card comes with no annual fee (ever), a rate of 2.9%p.a. on balance transfers for six months and an ongoing rate of 16.95%p.a. – the lowest of all no-fee cards issued by banks.
- The Virgin Saver – A high interest online savings account with the best introductory variable rate on the market of 6.75%p.a., moving to 5.35%p.a. after four months – the highest ongoing rate versus the Big Four.
Matt Baxby, Managing Director for Virgin Money Australia, added:
“The Virgin brand has been embraced by Australians and nearly 90%3 of Aussie consumers want Virgin in banking. With a five million-strong customer base across all Virgin brands in this country, Australians trust us to deliver great value, quality and superior customer service across the board – this is reflected in our fantastic new products that have been launched today.”
Virgin Money’s new range of products will be delivered through a strategic alliance with Citibank Australia.
Roy Gori, CEO of Citibank said, “It’s been a long time coming, but Australian consumers will now benefit from some much-needed innovation and creativity in the personal finance space. Virgin Money, in alliance with Citibank will deliver financial products with exciting benefits and ultimately, great value.
For more information, please contact:
Virgin Money Australia
T: 02 8249 8006
Notes to Editors:
About Virgin Money Australia
Virgin Money is the financial services arm of Sir Richard Branson’s Virgin Group. Established in Australia in 2003, Virgin Money offers a range of financial products including credit cards, savings accounts, superannuation and car insurance. Virgin Money promises to offer customers a great value, honest and transparent alternative to personal finance. Shaking up the Australian finance scene and driving fair competition to make everyone better off remains the primary focus of everyone at Virgin Money.
About the Virgin Money – Citibank strategic alliance
Virgin Money’s retail banking products are offered through its long-term alliance with Citibank, which also gives Virgin Saver customers access to the Federal Government deposit guarantee.
Virgin Money Australia has been modelled on the success of the business in the UK, which has issued 2.2 million credit cards and coordinated the most successful card partnership in Europe as well as a recent move into retail banking.
1&2Access Economic research – July 2010
’Exercising choice with financial products’ was a research report carried out by Access Economics and commissioned by Virgin Money in July 2010. The purpose of the research was to demonstrate the savings that could be made if the best financial products on the market were chosen by the average Australian household. The findings show that individual households could save on average $40,000 over ten years, or $10 billion collectively, if only 10% of the population chose the best financial products available in credit cards, savings accounts and mortgage products.
3’Virgin Money brand reputation study’ – Galaxy Research October 2009
Galaxy was commissioned by Virgin Money to conduct research on the health of the Virgin Money brand in October 2009. As a part of the findings for that study, it was found that 88% of the sample would like to see Virgin in finance.