Episode overview

Ruth Hatherley joins Steve Grace to explain how open banking is changing the home loan industry and why COVID was the catalyst that shifted over 70% of Australian borrowers to broker channels.

22 years of frustration before founding

Ruth spent 11 years at a big four bank and 11 years in a broking business. In both roles she watched consumers endure 50 to 60 day settlement periods while staff were rewarded for writing volume. She thought the bank was the problem, moved to broking, and found the same issues across all 40 to 50 lenders on the panel. The technology to process loans digitally existed, but nobody prioritised it.

How COVID shifted 70% of borrowers to brokers

Before COVID, 50 to 60% of home loans went through banks directly. Post-COVID, over 70% go through brokers or comparison sites. COVID forced banks to accept digital processes, but brokers were faster to adapt. They had already figured out digital ID, video KYC, and remote engagement. Consumers sitting at home had more time to research alternatives, and brokers were better positioned to serve them.

Open banking democratises data

Open banking lets consumers see all product offers in the market from one place and switch providers using a single set of data. Instead of being a walking data platform, consumers can share their financial information securely and receive competitive offers from multiple lenders at once. Ruth describes it as connecting organisations with truth, under consumer control.