Digital change champion

Memo pads with carbon duplicates trumped email communication when Bank Australia’s Head of Lending, Martyn Norman, started his career. But the bank moved faster than most to shake off its past manual ways by making e-conveyancing a key part of its digital strategy eight years ago. Martyn gives guidance to financial institutions preparing for a future that’s inevitably online.

After 26 years in the industry what change have you seen?

A generation ago our lending was mostly manual. Email wasn’t around and I wonder now how we got stuff done. Back then we used memo pads with carbon copies in triplicate for everything. If you needed to write a memo you’d put a piece of cardboard in the pad to ensure the duplicates didn’t bleed through to the next deed. We put the documents in the internal mail and waited for their return.

What was your first electronic settlement experience like?

Bank Australia was the first non-major bank to subscribe with PEXA. Because this was our first incoming refinance there was a bit of behind the scenes work – not unusual for banking. But the process itself was really simple. We could immediately see benefits in booking settlement. This is usually a time consuming process. Sometimes it involves waiting for two weeks due to processes at other banks. So in comparison to the existing paper process sending the invite was simple. Leading up to the day itself there was very little to do as well. Our documents were in order and the other party simply inputted their pay out figure.

How does an electronic transaction differ from transactions that rely on paper-based processes?

When we rely on a paper-based system consumers are conditioned to the fact that it’s a long and difficult process to purchase a house and settlement is stressful. Unfortunately when using that paper process there is often an expectation that things will go wrong. Electronic processing will change perceptions and take away the stress from transactions and make it simpler for the bank and most importantly for our customers. Banks that can do it well and early will get an advantage over their competitors.

What can we expect in the future?

The process of buying, selling and getting a loan will become incredibly streamlined. Technology wise we’ll have the capability within a few years to complete a property purchase in a couple of days from start to finish. The consumer is not demanding this yet. However, demand will follow so that years from now people will expect everyone involved in the process to be digitally enabled to provide a seamless customer experience.

The federal and state governments pushed to take property transactions into the digital economy. What was the impetus for Bank Australia to take transactions online?

Bank Australia is an e-conveyancing early adopter. The bank joined as an Electronic Conveyancing Victoria (ECV) pilot participant about 10 years ago. I was part of the industry working party for many years. We used ECV for our stand alone mortgage transactions. After the initial pilot, there were only two banks that continued to use the system and it wasn’t national. So when PEXA came along we were incredibly interested. It’s great that all the big banks are transacting. We were the first non-major bank to subscribe. We have a strong online presence with our application process. We now have more volume in our online process than through our branch network. Online is our number one channel. We also see great efficiency within our business with the introduction of a national mortgage form coming in early 2017 and we’ll be geared up and ready from day one.

How automated is Bank Australia’s business?

Today, all of our Victorian titles have been converted and are electronic. We don’t have paper titles. We don’t print or mail out paper contracts to our customers anymore. We produce a PDF version of the customer contract. All of the required loan documentation gets placed into the customer’s internet banking service and they log in securely with their internet banking password. They accept the contract and submit it back to Bank Australia. This was a Bank Australia initiative developed with our software provider, Data Action. 

What would be your advice to firms who haven’t yet started down the e-conveyancing pathway?

There are huge benefits for getting on board with e-conveyancing. When I first looked at e-conveyancing I could see huge benefits for Bank Australia.  As a result we decided to bring back our loan documentation preparation work in-house some time ago and that provided us with a substantial cost saving, in the order of hundreds of dollars per file. Using PEXA going forward we will no longer need to physically attend settlement. Using e-conveyancing gives a huge amount of comfort as transactions are checked prior to settlement.

We’ve always had concerns that the registrar might reject a mortgage as part of a paper transaction. PEXA gives you greater certainty of successful lodgement as documents are created within the PEXA system, checked through the lodgement verification service provided by the PEXA system prior to settlement and lodged with the titles office as part of the settlement process. That means that our customers have their transfer lodged in real time to get their names onto the title and our mortgage is lodged at the same time to protect the Bank’s interest.

Much is being said about e-conveyancing and digital disruption. But what does e-conveyancing mean for Bank Australia and your customers?

Taking the pain out of the transaction for consumers. That’s the greatest satisfaction for our customers. For Bank Australia it translates into happier customers and repeat business. Banks that perfect the online process before others will get a leading advantage over others. We will never compete with the big end of town but as a niche provider we have an edge and a nimbleness that our customers rate. Research as part of our rebrand revealed that customers don’t associate us with branches on every corner but a new bank with a strong online presence with a very good digital service.

For more information about becoming PEXA-ready or subscribing to the network please contact Marielle Yeoh, Executive General Manager, Financial Institutions: 03 9912 6566 / Marielle.Yeoh@pexa.com.au