As tech giants continue to muscle in on the financial services space, what does the future hold for intermediaries?
Nasdaq-listed Zillow Group, of which Australian billionaire James Packer holds a 9.35 per cent stake, announced last month that it has joined forces with Google in a partnership that combines the audience reach of the world's most popular search engine and the most visited real estate media network in the United States.
Zillow houses a portfolio of online home-related brands and has joined the recently launched mortgage comparison tool, Google Compare, allowing consumer access to Zillow's real-time mortgage rates and a range of lender ratings and reviews.
In a statement, Zillow said the integration allows all lenders who use Zillow Group Mortgages for their marketing efforts to now reach audiences across Google and Zillow Group's portfolio of consumer brands, which includes Zillow, Trulia, Hotpads and StreetEasy.
“Google Compare was developed to give consumers an easy way to understand and compare financial products online,” the statement said.
“Google has worked with a number of providers to provide a diversity of relevant results and purchasing options to users,” it said, adding that with the new launch borrowers searching for mortgage custom quotes on Google Compare for Mortgages will now have seamless access to Zillow's industry-leading real-time lender rates, reviews and ratings on both desktop and mobile devices.”
Zillow Group vice president of mortgages Erin Lantz said Zillow Group and Google share the same vision to empower consumers with comprehensive access to valuable information that helps them make more informed financial decisions.
"This partnership allows us the unique opportunity to help borrowers by providing them with the industry's most accurate, real-time information about home loans and mortgage lenders while simultaneously offering Zillow Group's lenders increased reach for their businesses,” Ms Lantz said.
In Australia, the online capabilities in residential mortgage lending have not been fully realised. An end-to-end solution is still some way off, although the emergence of peer-to-peer and marketplace lenders could speed things up.
The future of Australian lending and the role that new business models and disruptors will play in shaping the market are key themes in this year’s Australian Securitisation Forum (ASF) conference.
In previous years, discussions about innovation and disruption have often concluded that the online channel is a threat to third-party or direct channels, or at least a competitor. Talk of bank customers demanding an ‘omni-channel’ experience have also prevailed.
However, with more and more Australians choosing a mortgage broker for their mortgage needs, we could soon see a shift in this line of thought, which places brokers at the centre of emerging business models and disruptors.
Speaking on a panel at this year’s ASF event, J.P.Morgan executive director of Australian equities research Scott Manning said Google are trying to insert themselves in the front end of the value chain closest to the customer and are looking to obtain as much data as they can.
“You are going to see a lot more competition from people fighting for specific parts of the mortgage value chain,” he said.
Mr Manning said he could see online players moving into the mortgage space, noting that we have already started to see risk-based pricing in personal lending through peer-to-peer lending platforms.
“I think inevitably that will ultimately move into mortgage pricing and it may or may not be through brokers. It may be through self-discovery like Google in 10 years’ time,” he said.
“I know banks are quite passionate about the branch and people wanting a conversation and that kind of thing, a lot of that will be in tune with an online presence, whether that be through tutorial videos and online instructions or just more effective search positions.
“That will cause quite a significant rethink in where banks invest in technology versus physical presence. I think that will be a five- to 10-year story, not a two- to three-year story.”
Brokers will get the chance to hear form one of Google’s top talent’s at the 2016 Better Business Summit.
The Adviser can confirm that Susan Wheeldon-Steele, Google’s industry head of performance solutions, will be giving a keynote speech on digital and consumer insights at the award-winning event next year.
Ms Wheeldon-Steele will share her unique insight into where the digital world is heading and the impact it will have on brokers.
The Adviser’s Better Business Summit, in conjunction with The Adviser’s Better Business Awards, will be held in Brisbane on 18 February, Melbourne on 25 February, Sydney on 3 March, Adelaide on 11 March and Perth on 17 March.
Click here for more information.
[Related: Google mortgage play threatens brokers]
James Mitchell has over eight years’ experience as a financial reporter and is the editor of Wealth and Wellness at Momentum Media.
He has a sound pedigree to cover the business of mortgages and the converging financial services sector having reported for leading finance titles InvestorDaily, InvestorWeekly, Accountants Daily, ifa, Mortgage Business, Residential Property Manager, Real Estate Business, SMSF Adviser, Smart Property Investment, and The Adviser.
He has also been published in The Daily Telegraph and contributed online to FST Media and Mergermarket, part of the Financial Times Group.
James holds a BA (Hons) in English Literature and an MA in Journalism.
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