Evolving tech needs in the new normal

by Adam Brown and Kate Gubbins05 Nov 2020

Most of us are familiar with the many benefits that going digital can bring. Certainly, the events of the past few months have meant we have all been gaining more first-hand digital experience, either through Zoom and Microsoft Teams meetings or through the plethora of digital events now on offer.

Digital capability has become easier to access, easier to integrate and more secure. From an industry and lender perspective, there is a much stronger appetite and willingness to allow third parties to integrate and plug into their business rules engines. From a regulatory standpoint, verification of data is also now easier. If third party technology providers can verify the data first, it brings everyone closer to straight-through processing. This essentially means processes and turnaround times are faster and the rework that needs to happen on a submission is reduced – a win for all concerned.

Of course, the most crucial step on the road to digital has been customers’ acceptance, willingness and expectation that they will have digital capabilities in place. In this constantly evolving world, customers are seeking a quicker and more convenient mortgage process.

For a long time, lenders had insisted on printed forms and original copies of documentation with wet signatures, and for a while we all just accepted this process. But increasing use of mobiles and tablets has shifted behaviours and expectations. Deloitte research shows that nearly nine in 10 Australians own a smartphone – digital technology is simply part of everyday life.

Add to this the number of first home buyer schemes and the number of FHBs (traditionally the younger demographic) returning to the market, and the demand for digital communication and processes is only set to increase further.

Customers and brokers are also busier. When regulatory requirements mean the cost of getting a file to the point of submission is higher than ever before, extra efficiencies need to be built into the process.

We know that brokers have always built strong relationships with high personal touch. However, many brokers now appreciate that the digital tools on offer only add to their valued relationships with customers by getting them a faster and more accurate outcome.

While customer expectations and industry adoption of digital tools have been gradually on the rise, the biggest and most dramatic shift towards digital adoption has been due to COVID-19. In the past six months, things have accelerated at a pace no one could have anticipated.

The digital tools on offer only add to brokers’ valued relationships with customers by getting them a faster and more accurate outcome

It simply was not (and is still not in some states) possible to have face-to-face meetings with customers, so we have all been forced to find new ways of doing things and, in turn, have started to take a more active interest in different types of technology. For example, there has been an uptick in digitising verification tasks and digital collection of ID, using tools such as DocuSign via Loanapp for customer and broker signatures. All of this reduces the amount of rework involved and is already having a positive flow-on effect when it comes to submission standards.

On the verification side, around 55–60% of what is lodged with Advantedge now meets the minimum verification requirements (up from 30%), and this continues to increase. About 30% of what is lodged with Advantedge now goes unconditional the first time it’s received; in the past this was around 10–15%.

Both Advantedge and Simpology have long-standing histories of supporting and providing digital enablers. In 2017, Advantedge was one of the first in the country to deliver electronic loan documents and now supports full end-to-end digital functionality. Tools such as Simpology’s Loanapp also reduce back-end administration and enhance quality submissions.

The trend of increasing digital adoption looks here to stay, a sentiment echoed in a recent Advantedge survey which shows that over eight in 10 brokers intend to use or rely on digital tools in the future. The survey also revealed that the main barriers to future usage stem from brokers’ lack of knowledge or confidence in how best to use or apply the relevant digital tools.

Most aggregators and lenders have moved towards more online education and digital PD days, so we urge brokers to take advantage of continued education to help bridge this gap. Brokers should also look at current business models to understand how to integrate digitisation into the mortgage process so it doesn’t take away from their major strength – the customer relationship.

There is no shortage of opportunities for brokers to understand and educate themselves on the digital tools on offer. It’s now time to embrace them to get the best outcomes for you and your customers.

Adam Brown, General manager, AdvantedgeAdam Brown
General manager,
Advantedge

 

Kate Gubbins, CEO, SimpologyKate Gubbins
CEO, Simpology