Westpac to roll out digital loan to brokers next year

It does this by asking customers for digital consent and drawing on third-party data sources while using “advanced analytics” to perform credit checks, and also utilises customer biometrics (to speed up the ID process), verifies financials and undertakes property valuations.

Requirements and objectives, which had previously been a manual process, have also been digitised into the core process for the first time.  

Speaking of the digital mortgage process, Richard Burton, Westpac’s managing director, mortgages, commented: “What we’ve done for our customers, we’ve taken a lot of hard work out of the process using data and analytics. So they don’t have to look for bank statements and payslips etc, as part of the process. 

“We’re making it simpler for our customers because we’re doing a lot of hard work. So no more payslips, no more credit card or bank statements. Instead we’re using data and analytics to make the right responsible lending and credit initially the decisions.”

Brokers to have access next year

The long-awaited digital mortgage process will first roll out to borrowers via Westpac’s website or banking app – but initially only to new and existing sole “vanilla” applications (those on a PAYG income and with a loan-to-value ratio of 80 per cent or less) refinancing an owner-occupier loan to Westpac’s Flexi First Option basic product.

This will then be extended across the remainder of refinance customers progressively, as well as to other products and channels.

“This innovation is about digitising our end-to-end mortgage processing to make the time from application to unconditional approval easier and faster, with no paperwork. We are starting by targeting new or existing owner-occupiers looking to refinance, but over time the benefits will be felt by more customers,” Westpac Group chief executive Peter King said.

He added that it is expected to roll out to the broker channel “next year”.

Speaking to investors and media at a briefing on Wednesday (27 July), Mr King added: “We’re prioritising that first-party rollout of the capabilities, particularly with a digital mortgage. [Brokers will] be next year,” adding that the bank had “thought about priorities heavily”.

“We’ve reflected on the fact that refinancing will be a feature of the market going forward and that’s why the digital mortgage is focused on refinancing and proprietary channel.”

During the media briefing, Mr King also noted that the bank still had “more work to do” to improve turnarounds in the broker channel, reflecting that turnarounds had “gone out a little bit from what we had at the half [half-year results]”.

“The brokers are still supporting us, even though we’re a bit longer than the other banks at the moment. So there is still work to do in broker, but we’re prioritising some of our investment in first party at the moment… we’ve prioritised some of our investment in the channels that will help first-party initially come through to broker later on,” he said.

Big four focus on automatic credit decisioning

All four major banks have been working towards the roll-out of a fully digital mortgage process in recent years.

CBA already has its digital mortgage – Unloan – out in market via the direct channel, after launching it in May.

Similarly, NAB’s new Simple Home Loans platform, which launched for retail customers in 2021 utilises a digital end-to-end platform, with “intervention by exception”, automated data and identity verification, and digital signatures.

The platform has a median “time to yes” of around two days for the direct channel, with 35 per cent of applications being approved in less than one hour.

While it has been piloted for the broker channel, the bank has previously said it is aiming for a roll-out in the second half of the 2022 financial year, into FY23. 

ANZ’s version, ANZ Plus, is set to be introduced later in the year to provide a “straight-through process loan that you can get in under 10 minutes”.

[Related: AMP targets faster turnarounds with new tech]