A letter from our Founder & CEO regarding Volt Bank

A letter from our Founder & CEO to our members, investors, and the wider community regarding Volt Bank

Dear members, investors, and the wider community,

Earlier today, 29 June 2022, I was regretfully informed that Volt Bank, our partner bank, is closing its deposit-taking business and customers, including our Parpera members, need to withdraw their funds.

Importantly, Volt has communicated that all of our member’s funds are safe and can be transferred to an alternative bank before 5 July 2022 and that it is doing everything possible to return the deposits in an orderly and timely manner.

While our team is still digesting the information, I felt it necessary to be transparent and communicate to you our position on this matter: the situation, impact, and next steps.

As a matter of priority, we are acting immediately to ensure our members are not adversely impacted by this situation. Once we are comfortable that this has been satisfied, we will seek to share more information with you our plans for what we do next.

Thank you to our 500+ members that have trusted us to support their businesses in the early months of our operation.

While this matter will mean that we will be unable to onboard any new members or continue serving you from 5 July 2022 with a Volt bank account, we are working with our other partners and taking steps towards identifying alternative options to resume our services to our members as soon as possible.

We are taking this matter very seriously and apologise for the inconvenience caused and understand the impact this will have on you and your business.

We thank our members and really appreciate all of their love, support, and feedback on the high quality of service that they have expressed that we have provided them to date.

I remain proud of what we’ve achieved together and our team is committed to determining a way forward so that we can continue to better serve you and the wider Australian business community in the future.

Situation

As part of its offering, Parpera provides its members with access to Volt Bank accounts.

Earlier today, 29 June 2022, Volt Bank announced that it is closing its deposit-taking business and their customers, including our Parpera members, need to withdraw their funds to an external account.

Impact

The closure of Volt’s deposit-taking business directly impacts Parpera’s ability to provide its members with access to banking, payments, and cards services and requires Parpera to cease onboarding any new members immediately and providing its services to members by 5 July 2022.

Our priority now is to ensure your funds are quickly and easily returned to you.

We kindly ask that you use your Parpera App to transfer your balance to a nominated bank account with another financial institution before 5 July 2022.

Further, as a result of the situation, we will also need to cease access to the Parpera Business Debit Mastercard®

As such, we kindly ask our members to transition any existing subscriptions or card direct debits to an alternative card payments provider and use an alternative card for your day-to-day business activities, until we can resume our services.

Access to your Parpera App will remain active beyond 5 July 2022 so that you can continue to have read-only access to your past transactions, invoices, and tax insights until we determine a way to resume our service.

Based on communications from Volt Bank, we kindly ask our members to take note of and act on the following:

Withdrawal limits 

To help with the transition of funds to your external account quickly Volt has increased your daily transfer limit to $250,000.

Account closure

Volt will start closing accounts from 5 July 2022, so please ensure you have withdrawn all your funds to leave a balance of $0 in all accounts before then.

You do not need to contact us to close your account but can transfer the funds as you would normally do. 

Volt will close your accounts once all money has been transferred out.

Volt will not close your Volt account while there are funds in it. However, if you do not transfer your funds out by the due date, Volt may need to make alternative arrangements for your funds.

Volt will issue you, via email, a final closed account statement once the funds are transferred out, which will provide a record of interest paid this financial year, for your tax records.

Volt’s commitment to continued service

Your accounts are still operational, and Volt will continue to provide service to you as you transition your banking arrangements.

Volt is doing everything possible to return the deposits in an orderly and timely manner. 

The Australian Prudential Regulation Authority (APRA) is closely monitoring this process. 

In addition to this, deposits are protected under the Australian Government Financial Claims Scheme (FCS) which guarantees deposits up to $250,000 per account holder. 

You can find out more information about the guarantee at the FCS website.

Next steps

As expressed, our priority is to ensure that our members understand the situation, its impacts, and that they are not impacted by it.

Parpera has immediately ceased setting up any new accounts and will support its existing members to transfer any remaining funds out of their underlying Volt bank accounts via their Parpera App by 5 July 2022.

Any invoices that you have issued via the Parpera App and are due to still be paid into your Volt Bank account will need to be re-issued to your clients with alternative bank details.

Again, we are deeply sorry for the inconvenience caused by this situation.

Upon receiving this saddening news this morning, our team is working very hard to respond as best as we can and identify a way forward.

We have paused all member subscriptions for existing members, so no one will be charged for our service and we will keep our members updated as the situation progresses.

Concluding thoughts

We set out to transform the way people interact with financial services and the impact they have on the way they live their lives and to deliver on our purpose to make business easy.

We remain committed to delivering on this.

Our business remains adequately capitalised to address the operational challenges presented by this unforeseen matter.

We’ve seen fintech in other markets experience, recover, and grow out of similar events, and I remain confident that we will find a way forward to better serve our members.

We will communicate more on our action plan to resume serving the Australian business community as soon as possible.

As a final note, on behalf of our team, thank you to our members, investors, supporters, and Australian fintech community that have already reached out today to express their words of support and offers of assistance.

It’s times like these that highlight the importance of community and coming together to quickly find a solution to the problem and provide confidence that we can recover and continue on our mission.

For any of our members that have any questions, we will continue to be available to support you via in-app chat or by email at support@parpera.com

We thank you for your patience as we assess and react to the unfolding situation and look forward to providing you with further updates as soon as possible.

Sincerely,

Daniel Cannizzaro

daniel@parpera.com

Founder & CEO

Parpera

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Published on the
June 29, 2022
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