It reverts to a religious charitable development fund
The Australian Prudential Regulation Authority (APRA) has officially revoked the banking licence of the Lutheran Laypeople’s League of Australia (LLL Australia), following the organisation’s request.
The decision, announced on Tuesday, means the entity will no longer operate as an authorised deposit-taking institution (ADI) and will instead revert to a religious charitable development fund.
APRA defines these funds as entities established to borrow and use money for religious and charitable purposes. According to the regulator, this type of fundraising falls under the definition of banking business under the Banking Act 1959.
“These funds have historically been exempt from the requirement to be authorised under the Banking Act provided they meet specified conditions set out in the exemption order,” APRA stated. “The current exemption order is Banking Exemption No. 1 of 2021, which commenced on May 24, 2021.”
To maintain its status, a religious charitable development fund must comply with the Banking Act, which requires it to be legally recognised as a religious and charitable entity, operate within the scope of its founding constitution, and function on a not-for-profit basis.
With the revocation of its banking licence, Lutheran Laypeople’s League will no longer be subject to ADI regulatory requirements but must adhere to the conditions outlined in the exemption order.
Founded in 1921, LLL Australia has focused on offering investment products with no fees or charges. The organisation provides loans and fosters partnerships to support the Lutheran Church of Australia and its affiliated entities, including schools, churches, congregations, and aged care facilities.
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