The CEO of a fast-growing digital broker Finspo has said the group is aiming to digitise or automate many aspects of traditional broking so its brokers can focus on in-person interaction with clients.
Angus Gilfillan (pictured above), a former head of consumer lending at NAB, said the winning proposition to get a home loan was the mortgage broker proposition, with over 70% of loans originated by the channel.
However, after raising $2.55 million in equity as part of its Series D capital round, Gilfillan said scaling and creating its digital customer experience would mean digitising and automating many broking tasks.
“Customers love the choice, the advice, the independence, the service they get through brokers – there is a lot of great aspects to the mortgage broking proposition and it is growing,” Gilfillan said.
“But if you look at the industry, it’s pretty fragmented. Ninety per cent of brokers work in firms of 10 brokers or less, and they spend a lot of time on different parts of the mortgage origination process.”
This includes lead generation and business development, conducting needs-based conversations with clients, product selection, loan lodgement, administration and ongoing customer retention.
“There’s a lot on an individual broker’s plate. We’re using technology and our business model to free up time for brokers to do what they love best – working with clients around lending needs,” Gilfillan said.
Digitising and automating mortgage broking tasks
Finspo’s model includes centralised lead generation through digital marketing and partnerships, the removal of admin tasks, and aspects of lead nurturing, customer retention and communication.
It is also building what it is calling the market’s first end-to-end digital experience for customers of the channel – though speaking to a broker or expert will be a core part of that online experience.
“There’s been a lot of focus by lenders in the digital space – we’ve seen a lot of digital home loan products and digital origination from single lenders over the last five years,” Gilfillan said.
“That’s playing into the 30% of the market that want to go direct to lender But we haven’t seen those same capabilities brought into the mortgage broking sector.”
Gilfillan said that included being able to start applications online, meet an expert via Zoom, digitising customer data collection, and provide customers with online access to tracking of applications.
For example, Finspo’s Digital Fact Find data capture system allows customers to collaborate with brokers within a shared workspace, while its Application Tracker portal allows secure doc uploads and customers to track their application’s status in real time, as well as actions and meetings.
The business is also planning to shake up the broking role through automation, including offering algorithm-generated “robo” advice that will recommend products that suit customers’ needs. These recommendations will then be reviewed by a broker and discussed with a customer.
“Automation is a big opportunity over the next 12 to 24 months,” said Gilfillan. “Some things take a lot of time but don’t always add value to the customer, like sifting through policies, doing serviceability calculations and product selection. With rich data we have the chance to do things a little bit differently.”
Broker ‘experts’ still a part of the customer journey
Brokers working with Finspo – which it calls experts – are remunerated with an “above average salary”, rather than being offered commissions as per the traditional broker introducer model.
“We want our experts to be focused on the best thing for the customer – not be overly incentivised to recommend particular loans by the commission they are being paid,” Gilfillan said.
The package also includes a variable component, based on a scorecard that measures customer service metrics like quality of assistance, volume of customers helped and customer satisfaction.
Gilfillan said brokers still played an important role – even when tasks were digitised and automated.
“Brokers will still be critical in the experience and origination of a home loan – we are not seeking to disintermediate the broker, or remove the broker from the conversation,” he said.
“They will still play an important part in talking to customers, answering questions like: ‘Can I really afford a home loan? Does this suit my needs? Or what else have you considered?”
Finspo has achieved an average of 127% settlement growth over the last three halves. It recently launched a Fixed Rate Ending Calculator that estimates what someone’s repayments will jump to if they do nothing after moving off a cheap fixed rate, plus the money they could save by switching.
