Authorised Deposit-Taking Institution

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Authorised Deposit-taking Institutions (ADIs) is an Australian government term for financial institutions in Australia which are supervised by the Australian Prudential Regulation Authority (APRA) and authorised under the Banking Act 1959 (Cth) to accept deposits from the public.[1]

The term was adopted to formalise the right of non-bank financial institutions — such as building societies, credit unions and friendly societies — to accept such deposits. All ADIs are subject to the same prudential standards as banks but for a corporation to use word 'bank', 'building society' and 'credit union' in its name, it must meet certain requirements.

The concept of an ADI replaced that of "bank" following the recommendations of the Wallis Report in March 1997.[2]

The statutory requirements of an ADI are elucidated by the case of Commissioners of the State Savings Bank of Victoria v Permewan Wright & Co Ltd.[3] This case was seminal in characterising ADI's essential elements as being the collection of money by receiving deposits upon loan, repayable when and as expressly or impliedly agreed upon, and the utilisation of the money by lending it again in such sums as are required. If this is the institution's real and substantial business, and not merely an ancillary or incidental branch of another business, they are deemed to be a bank.

On 4 May 2018, APRA created a Restricted ADI framework [4][5] . The framework is designed to assist potential new entrants to the banking industry, particularly small firms with limited financial resources, to navigate the licensing process. Eligible entities can conduct a limited range of business activities for two years. APRA announced and authorised the first Restricted ADI, volt bank limited[6], on 7th May 2018.

See also[edit]


  1. ^ APRA, " List of Authorised Deposit-taking Institutions ", APRA, November 2017
  2. ^ Alan L Tyree (2000). "The Australian Payments System". Banking and Finance Law Review. 
  3. ^ [1914] HCA 83
  4. ^ APRA[1], APRA finalises new Restricted ADI licensing framework, May 2018
  5. ^ Dodd, Jo; Lauer, Marina; Wong, Ashley. "New banks, new rules: APRA updates ADI licensing regime". KWM. Retrieved 16 May 2018. 
  6. ^ "APRA authorises Restricted ADI". APRA. Retrieved 10 May 2018. 

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