The postal services company has revealed that it is “excited about the mortgages space” and is in talks with the regulators to see how it could apply its VOI app to the application process.
Following the announcement that credit union CUA had become the first lender to trial Australia Post’s new digital verification of identity (VOI) service, Australia Post’s general manager for digital identity, Cameron Gough, said that the company was looking into how the Digital iD™ app could be used in the mortgage industry.
Currently, users can generate a Digital iD™ online by completing the verification service in the app or by creating a profile online after uploading the relevant documents on a participating site (i.e. the CUA website when opening up a savings account). The app can then be used on various participating sites to reduce the need to provide all the relevant data once again.
Speaking to The Adviser, Mr Gough suggested that the mortgage space could also benefit from this VOI technology (which some players, such as HashChing, are already utilising), but noted the legal grey area of how digital VOI can satisfy the current regulations around VOI for home loans.
The Australian Registrars' National Electronic Conveyancing Council (ARNECC) sets out a Verification of Identity (VOI) Standard that specifies that original or certified documents be used and presented at a face-to-face meeting.
Mr Gough stated that the company is therefore working “quite closely with the regulators and ARNECC” to understand what “changes in rules they might be comfortable applying” to digital VOI services.
He said: “We have an existing service for verification of identity at Auspost — and that proves the identity of someone through the post office network [for their mortgage application].
“What we are looking at is a number of technologies that will allow us to verify someone's identity without them necessarily needing to come in physically to a branch or anywhere like that. It would require the support of the regulators and ARNECC to see it come to fruition, so what we're doing is working with the regulator so as to bring them up to speed and make sure they are aware of what this technology could do and we'll be guided by them on what the eventual changes are and what is possible.”
Mr Gough gave an example of a mortgage applicant in rural Queensland who “had to drive for three hours to go to [an Auspost] branch to spend two minutes showing his passport and driving licence, only to drive back home for another three hours”.
He continued: “So, particularly in Australia, with the vast geography that we have, there is a real challenge there for this requirement for personal identity checks. So, this is what we're excited about solving. We spent a lot of time in research to understand deeply the challenges of individuals of governments, of banks, and so on, and really, we're quite excited about the mortgages space.”
Mr Gough suggested that the mortgages space was ripe for the taking in this space, because there are many identity points through the home loan process.
“It begins right at the very start, when you go to the open house or auction. Many states require you to show your ID to register; the brokers who work through the loan need to verify their customer; the bank needs identity of the customer; conveyancers and landlords need it if you rent a house [while you wait for the sale to go through], etc. — so in all these situations you are proving your identity over and over again.
“So the core proposition is that you go through the process of verifying yourself once, preferably at the start of that, and then reuse that Digital iD™ all the way through, so it’s fast and more convenient for the customer, and more convenient for the relying parties as well.”
Should the regulators and ARNECC make virtual VOI permissible in the mortgage application process, Mr Gough said that the intent would be to make the Digital iD™ app available to “the whole banking industry”.
He explained: "We did a whitepaper which showed that around $11 billion of economic value is locked up in the economy because of the way digital ID is done. So we're very passionate about building this [platform] in a way that we can unlock that value in the economy. And we can only do that if we create a very open system, an open platform that anyone can use."
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