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The technological revolution enabling today’s brokers to go head to head with the banks

YOU’VE GOT THE POWER

MPAMAGAZINE.COM.AUISSUE 17.3

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20 www.mpamagazine.com.au

FEATURES

TECHNOLOGY

Forget digital disruption; technology is empowering brokers. MPA editor Sam Richardson talks to industry leaders, software developers and start-ups to find out how today’s broker can do things only the biggest banks could do just 10 years ago, and explore what’s coming next

PUTTING THE POWER IN YOUR HANDS

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‘DIGITAL DISRUPTION’ is a term that sums up broking’s problem with technology. It’s a term that invokes helplessness, and a fear that barbarian hordes from Silicon Valley will tear down the industry, using systems and concepts we can’t even understand. Yet while it’s essential to keep an eye on the competition, it’s the fear of digital disruption that’s holding the industry back.

An iPhone 6 has more processing power than NASA used to send a man to the Moon; so does your WiFi router. Brokers now have access to technology that can do more, and is far easier to use, than many banks in the 1990s and even 2000s. In fact brokers can do much more with technology in 2017 than they could just five years ago, from automated customer relationship management to electronic signatures.

This article is about how that technology is enabling, not just disrupting, broking. We’ve talked to the three biggest technology providers in the industry: NextGen.Net, Rubik and Sandstone, and the two biggest aggregators, AFG and Connective, to see how broking is changing and what’s coming next. We’ve also talked to a number of lesser-known companies and start-ups that are developing technology to enable you to do more.

We explore how technology is adding to and not eliminating a broker’s value proposition. You can talk a borrower through their mortgage application at the park during their lunch break, or alternatively on video from the other side of the planet. Having uploaded electronic documents and signatures, your software can then split those documents up or group them together, while redacting tax numbers and other data, before submitting to a lender. We also look at the technology brokers are missing out on, and why we’re still waiting for the paperless mortgage in Australia.

Whether you’re a single operator or a national franchise, technology is enabling you to do more. Read on for some ideas on how to get started.

TECH TERMS WITHOUT THE JARGON

APIAn application programming interface provides tools for building software. An open API allows others to modify and improve your software. It also helps different systems ‘talk’ to each other.

Big dataExtremely large data sets can be analysed by computers to reveal patterns, such as customer behaviour.

ChatbotA chatbot is a computer program designed to simulate conversation with human users, usually in order to acquire information.

The Cloud Cloud computing allows you to store data and host programs on the internet instead of your computer so they’re available anywhere with an internet connection.

Cybersecurity This protects computer systems from theft of data (such as personal details) or damage to the hardware or software.

Data scrapingA computer program ‘reads’ a document, such as a bank statement, or website to extract data.

Digital disruptionTechnology-driven innovation offers customers a better way of solving existing problems, undermining incumbent providers.



FEATURES

TECHNOLOGY

PASTTechnology is getting cheaper and more user-friendly, and is being used in a different way by brokers and aggregators

TO SEE how far broking has evolved over the last five years, you can’t just consider the technology itself – the actual hardware and software available to brokers – you also need to look at the utilisation of technology by brokers. Utilisation matters: Kodak infamously took too long to take digital cameras seriously, despite the technology being first invented in the 1970s.

According to Connective CEO Glenn Lees, brokers are utilising technology more than ever. “Everyone’s been talking about technology for years, but often people wouldn’t use it, or wouldn’t use it fully. What we’ve found in the last two years is a greater uptake of technology.”

Connective has been looking at how brokers use their Mercury platform, and Lees explains that the functions being used aren’t necessarily “the new and fantastic things in Mercury”. He says “quite often the things that add the most value are the simple things”. Change is being driven by both the younger, more technologically savvy brokers that are emerging and the regulatory challenges Lees says. “Interestingly, surprisingly – and quite boringly – the compliance tools we’re providing are being used more and more.”

Brokers are choosing to enter what Jaime Vogel, CIO at AFG, calls the “digital ecosystem”, particularly when it comes to

dealing with customers. Digitised CRM systems can automate many tasks and track individual customers’ situations, “making the broker proposition more professional”, Vogel

says. Contacting customers prior to the end of a fixed rate is a well-established practice; now technology can analyse changes in property values and a customer’s employment to prompt refinancing approaches, and AFG is introducing machine learning to further improve this technology.

The last few years have seen notable technological leaps forward in the area of uploading supporting documents, electronic signatures, and electronic applications for commercial loans. Less well known is the introduction, in late 2015, of APIs to allow broker groups to track lender requirements in real time. This is a huge improvement from the previous reliance on Microsoft Excel spreadsheets, says Tony Carn, sales director at NextGen.Net, and reduces mistakes and application rewording. It was a change driven

by necessity, Carn says. “When real challenges emerge in the market people scramble to respond, and that was APRA making changes to investment lending, and it meant that a lot

of changes were required of broker groups.” He predicts that half of broker groups will be using APIs to track lenders by the end of 2017.

Developing technologyThe way that broking technology is developed is also changing. Over the last 12 months Rubik Group has been taking a “human-centred approach”, explains Emily Chen, head of product – financial services. Software was traditionally developed for the immediate user, such as brokerage support staff. Now the end customer experience is paramount, with Rubik’s considerations including “what the customer expects from the broker; what is the experience they’re looking for and, most importantly, what does the future look like so we create a future-proof solution and don’t design ourselves out.”

“What’s critical to assess is not the direct cost of technology but the cost of

not investing” Tony Carn, NextGen.Net

A DECADE IN AUSTRALIAN BROKING TECHNOLOGY

JAN 2007 JAN 2008 JAN 2009 JAN 2010 JAN 2011

December 2007Legislation to prevent money laundering and terrorism funding (AML/CTF) changes to be ‘channel neutral’, opening the door for electronic verification of identity

June 2009Apple launches iPhone 3G, which enables internet tethering with a computer, allowing brokers to conduct meetings anywhere with a phone signal

June 2010ValEx and VMS valuation platforms both acquired by RP Data (now CoreLogic), creating a single platform for ordering and reporting valuations online

JAN 2012



FEATURES

TECHNOLOGY

Lees points towards the low subscription costs of the above-mentioned bolt-on technologies; one example is the Trello project management app, which costs US$10 per month yet was bought by technology giant Atlassian for $577m in January.

Carn talks about replicable technologies. “The cost of technology such as hardware, developers, data storage, etc, is not going down, but it’s important to look at the cost efficiencies … going to build 50 bespoke solutions for 50 lenders is an enormously expensive thing to build and maintain.” The prestige attached to highly expensive bespoke solutions is misplaced, he suggests. “What’s critical to assess is not the direct cost of technology, but the cost of not investing.”

Technology is also getting easier for brokers to use, according to Lees at Connective and Vogel at AFG. Much of the ‘heavy lifting’ in applications is done by relatively simple software, Vogel says. Brokers who have more time available can make use of customer analytics; for brokers without the time the aggregator can step in. “We know that some brokers have the time to do that, but a lot don’t, and we see that as an opportunity,” he says.

Finally, brokers are looking beyond the technology their aggregator is offering them, according to Lees. What the aggregator is offering on a plate “is necessary for but not sufficient for adoption”; brokers can see that adding other bolt-on services can give them an edge. For technology, simply being new is not enough. Lees says the “key measure of success is actual use and actual engagement”.

Developers are looking for end-to-end solutions across the lending process, explains Linda Stanojevic, global chief product officer at Sandstone Technology. “We look at building smart connections; we’re building smart connections between digital and physical flows [of information].” She says it’s “not just about working your end well, but really collaborating across the value chain”. That means, for example, that banks get the right pieces of information from brokers at the right stage of the application, reducing the time to approval.

“We’re seeing the emergence of really game-changing technologies, but they do take longer than we’d like to see,” says Carn at NextGenNet. The challenge is not necessarily about the take-up of technology but comes from the regular updates required for modern software, he explains. That doesn’t mean technology isn’t moving forward in the meantime.

Beyond the traditional developers and large projects there are hundreds of bolt-on services for project management and document storage that brokers can use, explains Connective’s Lees. “The real power comes when the platform we provide has an open API,” he says. “You can find the bits you want and integrate them yourself, or with our help. There is a whole universe out there of really small, well-devised micro-services which you can put together.”

Using technologyCost is a perennial concern for small businesses, but the developers and aggregators MPA spoke to argue that the cost of technology is falling.

MORTGAGE TECHNOLOGY WORLDWIDE

Rocket Mortgage, USAQuicken Loans’ Rocket Mortgage

was unveiled to Americans in a glossy Super Bowl ad last year, which appealed “to the power of America itself”. Using a smartphone app, customers can get a conditional approval in less than 10 minutes. Quicken Loans pulls information about their property, employment history and bank accounts from other sources. It has a sliding bar for customers to choose their desired fees and interest rates, while using live market data when offering the final interest rate. The Rocket Mortgage took a team of 450 engineers to build, and Quicken Loans plans to spend $132m on promoting it.

Habito, UKLaunched in April 2016, Habito is a ‘digital mortgage

broker’ that uses an automated chatbot to talk to clients about their needs and recommend mortgages in less than 10 minutes, which customers can then apply for. The software also tracks changes in the mortgage market, such as eligibility criteria, interest rates, affordability and product features, to identify trends that could affect borrowers. The company claims it has been used by 20,000 people and handled $82m worth of lending. In January 2017 it raised $9m in funding from Silicon Valley.

JAN 2012 JAN 2013 JAN 2014 JAN 2015 JAN 2016

A DECADE IN AUSTRALIAN BROKING TECHNOLOGY

October 2013 NextGen.Net launches the ApplyOnline Supporting Documents service, enabling brokers to upload and submit documents electronically

November 2013LIXI 2.0 launched, helping lending and broking software better communicate through a common language

March 2016Property app launched by Commonwealth Bank, allowing borrowers to apply for conditional approval on a mortgage using their phones

September 2016First fully electronic mortgage in Australia signed by Bank Australia customer


BREEZEDOCS


FEATURES

TECHNOLOGY

We’ve picked out six lesser-known technology companies and platforms that are changing the way you write mortgages

Founded: 2012

Who pays: The user, which could be lenders or brokers

Training available: Little training required; demonstration videos available

What is new about what you do?Hany Pham, CEO: Breezedocs provides groundbreaking new technology which automatically splits and organises borrower supporting documents in loan applications. This provides lenders with consistency and uniformity across all incoming loan applications, which increases the speed and reduces the cost of loan assessments and approvals. Breezedocs was also the fi rst company to use software to automatically redact tax fi le numbers, and is currently the leading solution in the market.

How do you help mortgage brokers?HP: Lenders are increasingly pushing more and more of the workload onto mortgage brokers … for example, many lenders are now requesting that brokers individually split up each document before submitting the loan. This means that brokers need to either scan fi les individually or use software such as Adobe Acrobat to manually split up each fi le. Breezedocs automates this process as it is able to recognise the textual content of each document and accurately splits up and relabels each attachment.

How do you help mortgage customers?HP: Within our existing lender partners, we have seen savings in loan processing time and cost of up to 75%. They have also been able to achieve consistent turnaround times within hours on the same day. This greatly benefi ts mortgage customers as turnaround times continue to be a pressing issue for the industry. Borrowers want rapid responses from lenders, and Breezedocs is able to dramatically reduce turnaround times, which signifi cantly improves the borrower experience.

PRESENT

LOAN FLARE

Founded: 2016

Who pays: Brokers, through a monthly subscription

Training available: Helpdesk, chatbots and product ideas portal

What is new about what you do?David Kim, founder: LoanFlare is a platform allowing brokers and their customers to work on the mortgage applications documents together – the fi rst software to connect brokers and their clients. Some of our exclusive features include a customisable, multistage fact-fi nd, real-time serviceability calculations, as well as automatic identifi cation and renaming of supporting documents.

How do you help mortgage brokers?DK: LoanFlare arms brokers with the technology they need to remain competitive, allowing them to manage and track home loan applications completely online and export all the data to aggregator CRMs and ApplyOnline. We’re working on a loan tracker tool that taps into bank feeds to trigger broker alerts, and a marketplace for cross-selling products.

How do you help mortgage customers?DK: We make the application process fun and informative through a contextual chatbot and by updating serviceability metrics every time information is added. We then use this information to recommend related products and services to borrowers, unlocking signifi cant revenue streams for the broker. By capturing borrowers into a digital ecosystem that persists even after loan settlement, we aim to turn brokers from a one-time sale into fi nancial concierges for life.

“We aim to turn brokers from a one-time sale into fi nancial concierges for life”

able to achieve consistent turnaround times within hours on the same day. This greatly benefi ts mortgage customers as turnaround times continue to be a pressing issue for the industry. Borrowers want rapid responses from lenders, and Breezedocs is able to dramatically reduce turnaround times, which signifi cantly improves the


ZipID


PEXA

Founded: 2010

Who pays: Depends on arrangement customer has with lenders/lawyers/conveyancers

Training available: Free PEXA Direct training for lawyers and conveyancers

What is new about what you do?Mike Cameron, group executive operations: The PEXA e-Conveyancing network operates like a private virtual space, bringing banks, conveyancers and land registries together to securely settle property transactions. With PEXA operating in fi ve Australian states, electronic property settlement is now within reach of about 95% of Australians. Importantly, the Victorian, NSW and WA governments have unveiled deadlines to ‘turn o� ’ certain paper-based property transactions in 2017, while the NSW government plans to phase out paper transactions by 2019.

How do you help mortgage brokers?MC: PEXA ultimately is a breakthrough for end property consumers. It means that their transactions are safe, e� cient and fast. Brokers can recommend electronic conveyancing to their customers for these e� ciency benefi ts. PEXA is currently working through options to bring mortgage brokers greater visibility of the progress of their clients’ property transactions. This development has the potential to signifi cantly change the service o� ering mortgage brokers o� er their clients.

How do you help mortgage customers? MC: An increasingly technology-savvy public will ask to settle property transactions online in preference to traditional paper-based conveyancing. Consumers are already searching for properties on their digital devices and embraced electronic banking transactions when the technology emerged in the 1990s.

An increasingly technology-savvy public will ask to settle property transactions online in preference to traditional paper-based conveyancing. Consumers are already searching for properties on their digital devices and embraced electronic banking transactions when the technology emerged in

Founded: 2013

Who pays: App is free for brokers; lender pays for the report. Agency services dependent on broker–lender arrangement

Training available: Simple to use; support available at www.zipidbroker.com.au

What is new about what you do? Sean Simmons, founder: ZipID (now part of Veda) digitises and mobilises customer ID checks. We’ve focused on solving the pain points for brokers, banks and consumers around face-to-face mortgage ID requirements. The ZipID mobile app puts brokers in control of a paperless, safe and standardised ID process using their smartphone or tablet. If the broker can’t meet the client, they can book a ZipID agent appointment to carry out the ID check at their home or work.

How do you help mortgage brokers?SS: ID processes cause common problems for brokers. They’re paper heavy and inconsistent across banks. This results in lots of rework, causing unnecessary delays and frustration. ZipID helps mortgage brokers streamline the path to approval by improved submission quality. ZipID is ID done once, done right.

How do you help mortgage customers?SS: Customers no longer have to be inconvenienced as a result of insu� cient or illegible ID, or concerned about insecure collection of their ID. The ZipID app guides the broker to capture high-quality images of the necessary ID documents, the customer’s signature and a photo as proof of the face-to-face meeting. The ZipID system then securely protects the customer information. ZipID’s ‘come to you’ agency option saves many customers from having to go and fi nd a JP or queue up at a branch or post o� ce.

images of the necessary ID documents, the customer’s signature and a photo as proof of the face-to-face meeting. The ZipID system then securely protects the customer information. ZipID’s ‘come to you’ agency option saves many customers from having to go and fi nd a JP or queue up at a branch or post o� ce.

“We’ve focused on solving the pain points for brokers, banks and consumers”



FEATURES

TECHNOLOGY

KUBIO

Founded: 2016

Who pays: Brokers, through a monthly subscription

Training available: Online user and development support

What is new about what Kubio does?Mark Churchill, managing director, AllFin Financial Services: Kubio is one of Australia’s advanced business origination platforms for commercial brokers. Designed by brokers for brokers, its technology platform automates loans from lead through to settlement and beyond, providing e� ciencies as brokers grow. As a cloud-based platform, brokers can access and update their clients’ information anywhere, any time. Kubio increases brokers’ abilities to manage sales, customer relationships, operations and fi nance – all within one platform.

How does Kubio help mortgage brokers?MC: The platform provides a single view of clients and their assets, and makes it simple to track leads from opportunity through to settlement. Kubio makes every process simpler – for the broker, clients and referrers. Straightforward online forms, streamlined signatures and authorisation are all on the one platform to facilitate faster fi nancing and increase capacity for a more personalised service. The platform allows brokers to build custom workfl ows to help automate business processes. This way, brokers can meet lender submission requirements, thus improving the likelihood of a quicker submission.

How do you help mortgage customers? MC: Kubio automates the application process from lead through to settlement, making the process simpler and more e� cient for clients. It’s designed to manage client authorisations using digital signatures, and performs credit checks and business verifi cations without the need for the client to chase the information themselves. Unlike mortgage broking, until now commercial loan applications have been very manual and paperwork-intensive, and this has been time-consuming for brokers. Kubio makes data more accessible, and provides a seamless and easy experience for clients.

“Until now commercial loan applications have been very manual and paperwork-intensive”

“We genuinely o� er an end-to-end solution for transaction management – something new to the Australian market”

DOCUSIGN

Founded: 2003

Who pays: The broker; always free to the signer of the document

Training available: DocuSign University website

What is new about what you do?Brad Newton, vice president Asia Pacifi c: While other providers may o� er one or two of the features DocuSign has, the key di� erentiator for us is the fact that we genuinely o� er an end-to-end solution for transaction management – something new to the Australian market. Our Winter ’17 release announced the addition of Supplemental Documents to allow for more disclosures to be included in a single contract, as well as our payments capability coming in March, where you can sign and pay in one step using a credit card, Apple Pay, or Android Pay.

How does it help brokers?BN: DocuSign’s Digital Transaction Management (DTM) platform and eSignature service enables preparation, execution and management of transactions in an all-digital environment. With DocuSign you can boost compliance by meeting the demands of the Electronic Transactions Act. 1999, simplify loan processing, increase accuracy and productivity, while saving money. In real terms, DocuSign delivers on average $32 in value per transaction – including hard dollar savings, accelerated revenue and productivity gains – and reduces turnaround time with more than 60% of transactions completed on the DocuSign Global Trust Network in less than one hour.

How does it help consumers?BN: The signing and management of paper-based contracts can be a time-consuming and inconvenient process for borrowers. With DocuSign DTM and eSignature, the consumer can sign documents quickly and easily any time, anywhere, on any device. Borrowers can sign loan contracts from the comfort of their home, or on the road, without the need to physically visit an o� ce or have documents overnighted to them.

while saving money. In real terms, DocuSign delivers on average $32 in value per transaction – including hard dollar savings, accelerated revenue and productivity gains – and reduces turnaround time with more than 60% of transactions completed on the DocuSign Global Trust Network in less than one hour.

How does it help consumers?The signing and management of

paper-based contracts can be a time-consuming and inconvenient process for borrowers. With DocuSign DTM and eSignature, the consumer can sign documents quickly and easily any time, anywhere, on any device. Borrowers can sign loan contracts from the comfort of their home, or on the road, without the need to physically

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FEATURES

TECHNOLOGY

More data and end-to-end systems are pushing us ever closer to the paperless mortgage and point-of-sale approvals

PREDICTING THE future of technology is a risky business. From the millennium bug to Google Glass, we’ve seen plenty of ‘game changers’ which were no such thing. Rather than take an impossibly broad view of the future, we asked our industry leaders to explain what brokers should expect over the next few years, starting with the paperless mortgage.

Glenn Lees, CEO of Connective, says the entirely paperless mortgage is “closer than ever … I think what’s driving it now is lenders understand what a competitive advantage it can be”. The barriers are simply “institutional inertia”, he says, with lenders’ risk and compliance teams “understandably nervous” about changing the application process.

NextGen.Net sales director Tony Carn

is less optimistic; he believes the paperless mortgage will take some time to come about due to the current focus on credit risk. However, he says the technology is there, and mortgages are already becoming increasingly electronic thanks to e-conveyancing platform PEXA and increasing use of electronic verifi cation by lenders.

At AFG, CIO Jaime Vogel believes that “we will end up with a signifi cant number of applications being digital end-to-end”. The process will be similar to the gradual take-up of ApplyOnline. “As lenders understand the benefi ts of that innovation it’ll progressively change and we’ll fi nd the vast majority will be digital end-to-end,” Vogel says. “We feel the technology would be relatively easily implemented in the broker process.”

VERIFYING WITH VIDEO AT HASHCHING

Identifying borrowers, under the Know Your Customer (KYC) guidelines, has long been a time-consuming part of the application process. It was a particular problem for online marketplace HashChing, CEO Mandeep Sodhi recalls. “The broker was seeing ‘the consumer is in Cairns, but I’ve got this great deal and I’m in Sydney’.” For brokers there was an additional problem: having to visit a bank or Australia Post outlet to get identifi ed was causing many customers to walk away from a deal.

HashChing’s virtual online identifi cation (VOI) technology uses a video call to compare the borrower to a photo on their Australian passport or driver’s licence, giving the broker a percentage of how much they match. It also does a behind-the-scenes DBS check and tells the broker the borrower’s current location, and the video is stored for seven years in case of an enquiry from ASIC. The system is currently being trialled by 150 brokers, saving them eight hours on average, with a full rollout scheduled for 1 March.

There’s no legal barrier to video identifi cation; the challenge is persuading lenders to accept it. While HashChing has an exclusive partnership with the South African developer of the software, E4, it is encouraging lenders to work with E4 to use VOI technology. Combined with online document collection, VOI can free brokers from the tyranny of distance, Sodhi believes. “With this technology the broker can be anywhere in Australia and the consumer can be anywhere in Australia … the geographic barrier is gone.”

Using dataIn March 2016 Siobhan Hayden, then-CEO of the MFAA, predicted the next evolution in mortgage broking would be driven by data scraping. Data scraping is extracting data from documents, web pages and storage vaults, which can then be put to use in a number of ways: automatically filling in forms, reducing the need to ask borrowers for documentation, and more informed decisions by lenders.

Data is already changing the mortgage application process. Electronic mortgages through Bank Australia and conditional approvals via the CommBank Property app are available to customers of these banks, as the banks already have the relevant data. Data scraping across institutions is in its early stages, warns AFG’s Vogel. “There’s certainly not enough data available to make a complete and proper assessment, but we’re trying to make the best of the data which is available to use.”

Other professions are further ahead in data scraping. Next.Gen.Net’s Carn points out that accountants can already access information on their clients held by the ATO; giving brokers the same access would be a “very simple technology solution, but there [needs to be] a risk appetite to allow that to happen”.

At Rubik Group a current project is looking at using wealth management to provide solutions for property investors. “One of the top unmet needs is around investment property,” head of product Emily Chen says. “It’s almost personal fi nancial management: how do I budget? How do I know when I’m ready to buy that next property?”

Already some banks offer digital ‘dashboards’ that show customers the funds available in their current, savings and super

FUTURE

check and tells the broker the borrower’s current location, and the video is stored for seven years in case of an enquiry from ASIC. The system is currently being trialled by 150 brokers, saving them eight hours on average, with a full rollout scheduled for 1 March.

There’s no legal barrier to video identifi cation; the challenge is persuading lenders to accept it. While HashChing has an exclusive partnership with the South African developer of the software, E4, it is encouraging lenders to work with E4 to use VOI technology. Combined with online document collection, VOI can free brokers from the tyranny of distance, Sodhi believes. “With this


Source: Deloitte/MFAA, Customer Experiences of Using Mortgage Brokers, October 2016


THE LIMITS OF ONLINE CHANNELS

Deloitte surveyed 1,000 borrowers who had taken out a home loan in the two years to September 2016 on their channel preferences:

of customers would ‘consider’ doing their next loan application

entirely online

However:

would do their next loan themselves online rather than use a broker or

go direct to lender

Talking to consumers in focus groups, Deloitte found that participants valued having a personal relationship with brokers/lender staff, as well as the ease and advice associated with those channels

accounts. Chen suggests that property could be added to this mix, bringing in external data on property values on fixed loan terms, creating “a total wealth view for the customer”.

What’s holding back data scraping – and

by consequence paperless mortgages – is concerns around security. Computer hacking has become international news, and 71% of Australians are concerned about having their information stolen, according to Veda’s 2016 Cybercrime and Fraud Report, with older Australians more concerned.

“A lot of brokers are not aware of how much is invested in secure data processing,” argues Carn. However, he warns that vulnerabilities remain: “We’re operating in a market that’s heavily regulated, and everyone’s aware of data security, yet we still see a lot of emailing of personal customer information, which I think is quite horrifying.”

Vogel believes younger borrowers are more accepting of their data being used. “If there is value for the customer and the opportunity to get a reduced interest rate then I’d certainly expect that a high percentage of customers would be willing to provide that information.” That is conditional, however, on those customers trusting that brokers can keep their data secure, which is why AFG is investing heavily in data security.

The role of aggregators and developersPart of the institutional inertia holding back broking technology is the question of responsibility: who should be developing, implementing and advocating for new

technology? MPA asked technology developers and aggregators what they were doing, and what role they play.

Vogel sees AFG’s role as a “technology and marketing partner” for broker groups. “These are a couple of areas where we as an aggregator have the resources and capability to invest heavily to benefit the broker,” he says. AFG has been repositioning the company as a technology provider for its brokers, leading the way into emerging fields such as machine learning and data security.

At Connective, Lees sees the aggregator’s role as going beyond that of a product provider: “Our role is to look to the horizon in ways brokers simply don’t have the time or the knowledge to do: to sort through what’s out there and try to pick the winners, if you like, and to give brokers a true platform that is relevant to their business and the way they choose to work.” It’s crucial that new technology suits brokers, he argues. “People are looking for technology to be a silver bullet, but technology never trumps activity; you can have the best tool in the world, but if people don’t like it or trust it they won’t use it.”

“Customers are looking for a seamless experience, and less of the fragmented

user experiences we may have had in the past” Emily Chen, Rubik Group

At Sandstone, global chief product officer Linda Stanojevic aims to develop seamless, end-to-end systems for lenders to cut down turnaround times. “We’re very much talking to the LIXI community and looking at standardisation.”

In 2017 NextGen.Net will be enhancing

30%

5%



FEATURES

TECHNOLOGY

In 2014 Glenn Lees of Connective and Tony Carn of NextGen.Net were asked to predict the technology brokers would have by 2024. MPA decided to revisit these predictions and ask how close they were to reality.

Glenn Lees – Data vaultsData vaults are already being constructed by the private sector, says Lees, with initiatives such as Apple Pay and biometric security. “I see us getting there a little more every day.”

Tony Carn – Machines talking to machines Machines are now talking to machines through APIs, used in processes such as the electronic verification of identity and real-time updating of lenders policies, Carn explains.

WHAT WAS THE FUTURE IN 2014?

will be more take-up of electronic signatures, predicts Connective’s Lees. Brokers will increasingly use bundles of microservices to construct their own customised platforms. “There’s not necessarily a killer app for finance or mortgages,” he says.

Falling turnaround times and improving technology will eventually enable point-

of-sale approvals, according to Carn at NextGen.Net. “We’ll see technology allow us to get closer to real-time point-of-sale approvals by increasing integration in the loan approval process – automatically verifying identity, automatically verifying income, using optical character recognition.”

CBA is already using optical character recognition technology, Carn says, and he predicts that automated risk pricing of loans by lenders could also begin to emerge. The

result will benefit brokers: “I think we should see brokers becoming empowered to provide better quality at the point of sale.”

AFG’s Vogel also believes that improving technology, and specifically the establishment of data sharing ‘digital ecosystems’, will give brokers an edge. Even the individual broker will be “presented to the customer as someone with a significant technical underpinning in their business”, he predicts. “It’s giving brokers the same technical online digital solution that you would expect from a much larger organisation, putting them on the same foot as online lenders.”

Correspondingly, there will be a growth in virtual broking, according to Rubik’s Chen. Again, brokers rather than disruptors will benefit. “We’re not necessarily talking about Uber for mortgage brokers, but instead providing broking advice digitally, the customer experience, whether it’s through Facetime or Skype,” Chen says. The key is learning how to store the evidence of advice delivered virtually in a way regulators can accept.

For many, changing technology equates to

disruption, but for Carn, the mortgage space is far more complicated: “I read a comment from a gentleman this week talking about how Airbnb and Uber get thrown around a lot, and he said they have capitalised on the use of underutilised resources, but you don’t see underutilised resources in the financing game; you don’t see the underlying restrictions of APRA and the other regulators in the market. Brokers rest assured that broker groups are investing heavily to protect their interests.”

the user experience of ApplyOnline, says Carn, starting in March. It is also looking at how it can increasingly integrate the borrower into the ApplyOnline process.

Chen at Rubik sees her organisation’s role as helping brokers take on new technology, while navigating tightening compliance requirements. They’ll be continuing their ‘human-centred approach’ with borrowers in mind, Chen explains. “Customers are looking for a seamless experience, and less of the fragmented user experiences we may have had in the past. It’s actually a very exciting time to be a technology vendor.”

PredictionsFinally, we asked the aggregators and technology providers to give us their predictions of what brokers will see change in the next two to five years.

Turnaround times will continue to fall, predicts Sandstone’s Stanojevic. Application processes will be more driven by consumer perspective, and consumers will demand immediate responses and more relevant information. “Don’t just give me an email with a long list of the information I might need; give me the information that’s applicable to me,” she says.

Aiding this reduction in turnaround times

“It’s giving brokers the same technical online digital solution that you would

expect from a much larger organisation, putting them on the same foot as online lenders” Jaime Vogel, AFG


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