Sandstone sets focus towards SME lending with new partnership

Founded in 2004, Brilliance is a fintech company focused on bank digital pricing and profitability solutions, and is said to have clients that include Commonwealth Bank, NAB, Westpac, HSBC and Macquarie. 

In 2020, Brilliance launched DPX, an integrated and cloud-native product that allows banks to monitor its pricing, rates, product and profitability management in real time. 

Sandstone has said that driving its decision to partner with Brilliance was the identification of a “need to incorporate risk-based pricing into the systems workflow and decisioning engine” that came from the extension of its loan origination platform, LendFast.  

Further, the banking fintech also affirmed that this arrangement will allow it to “streamline the loan application experience”.

“By having automated deal pricing and profitability optimisation functionality embedded in the origination flow, every deal is made with eyes wide open, consistently and efficiently,” Sandstone said in a statement.

However, Sandstone has expressed that this will benefit the “broker journey” for small and medium-sized lending in Australia and New Zealand, moving away from a digital focus towards only CRM and origination journey and incorporating deal assessment and relationship profitability. 

“Many SME lenders cling to legacy processes that are potentially slowing them down. Having a digitised, consistent process and procedure can help build and maintain customer relationships, enhance proactive and reactive retention measures, and reduce ‘special pricing’ offered inconsistently and without justification on the front and back book,” Sandstone said in a statement.

Sandstone has confirmed that this integration will only be available to assessors and relationship managers within the bank and not directly with brokers.

Sandstone Technology chief executive Mic Phillipou commented that this partnership, and subsequently the introduction of real-time risk-based pricing, will “ensure banks and financial institutions can be confident in the deals being executed by their relationship managers”.

“With interest rate increases expected to impact both lenders and borrowers alike, we understand that real-time data driven decision making will be crucial to financial institutions’ success,” Mr Phillipou said.

In a statement supplied to The Adviser, Mr Phillipou said that when a broker needs to submit an application that deviates from the rate card or standard fee structure, “having this level of integration results in real-time assessment of the loan fundamentals so that a decision can be made quickly and with eyes wide open”. 

“Therefore, rather than waiting days or weeks for a response from the bank the broker gets an immediate steer on whether the deal will proceed,” Mr Phillipou said.

“For more complex cases or where the relationship profile is a consideration, the broker can be presented with multiple scenarios or options for discussion with the borrower.”

Brilliance president CEO Jean-Edouard van Praet commented that the combination of digital technology and the fintech’s partnership with Sandstone means that “SME and business banks can access this critical piece of the origination jigsaw puzzle and stay competitive in an increasingly competitive market”.

[Related: Treasury begins ‘open finance’ consultations]