Unveiling the future: open banking redefines mortgage broking

In an insightful interview forming part of Frollo’s State of Open Banking 2024 report, Renee Blethyn, Head of Broker Partnerships at NextGen, discussed the transformative role of Open Banking in the lending industry. Her interview detailed how NextGen’s rapidly evolving suite of Open Banking solutions are helping make lending easy for their lender and broker industry partners.

Blethyn described how NextGen utilises Open Banking data and Frollo’s Open Banking technology to craft a ‘Financial Passport’. A ‘Financial Passport’, part of the NextGen – Open Banking CRM solution, is accessible to mortgage brokers and their clients prior to creating a new application. It provides brokers with a comprehensive view of their client’s financial position through a detailed insights document, empowering better decision making prior to choosing a lender.

“When we tested [the Financial Passport] with consumers who had been through the process with a mortgage broker, what they told us was, if they’d had that document prior to that process, they still would have chosen a mortgage broker; but they would have felt more enabled, more informed, and more confident.”

The benefits of Open Banking for brokers and lenders are numerous, promising faster approvals, less reworks, reduced fraud, and the secure exchange of verified data. Finsure, a trailblazing broker group, was the first to integrate NextGen’s Open Banking CRM technology, with Finsure brokers hailing it as an indispensable tool.

The wealth of rich data derived from Open Banking also empowers brokers to deliver tailored services aligned with their unique business propositions. For those Finsure brokers who made the NextGen Open Banking CRM solution part of their process, Blethyn learned, “it’s a service that they can’t do without, and it is the preferred choice for some of the brokers who are using that service”.

Open Banking, according to Blethyn, addresses customer concerns about data security, providing a safe and reliable way for brokers to offer their services. Feedback sessions with early adopters echoed the sentiment that the service is a game-changer, providing a secure avenue for customers wary of data sharing.

“And what it’s done for them is, it’s given an option for when those customers who are concerned about sharing their data under other ways, it gives them a safe way for them to be able to offer and still continue to service those customers.”

Blethyn’s insights shed light on the growing interest and opportunities within the Open Banking market for mortgage brokers. She urged brokers to explore available services, emphasising the continual evolution of NextGen’s Open Banking solutions based on user feedback.

“Brokers giving feedback on features is incredibly important. Taking a look at the services available, powered by Open Banking, is highly encouraged, as it offers rich data that’s easily accessible and hard to obtain otherwise.”

Being an early adopter, Blethyn suggested, could offer a competitive edge, especially as Consumer Data Right (CDR) reforms extend into sectors beyond financial services.

Looking ahead, Blethyn foresees a surge in Open Banking activity over the next six to nine months, particularly within the lending landscape. Open Banking, she believes, is not just an evolution in lending but a transformative force reshaping the entire financial services landscape for Australian consumers.

“I really do see Open Banking as an evolution of not just the lending landscape, but what financial services can do for consumers in Australia. The richness of the data, the incredible solutions developed now and in the future— that’s what I’m excited about.”

The interview underscored Open Banking’s potential to revolutionise the industry, offering not only rich data but also innovative solutions that are both current and future-focused.

As we approach the end of the year, the insights from Renee Blethyn’s interview provide a thought-provoking glimpse into the transformative impact of Open Banking on mortgage broking, as outlined in Frollo’s State of Open Banking 2024 report. For a deeper dive into NextGen’s approach and Blethyn’s perspectives, we highly recommend watching the full interview.