‘First’ ePayments Code compliant expenses tool launches

Speaking to Mortgage Business, the head of the Australia and New Zealand arm of online financial assessment solution company MOGOPLUS, Mike Page, and chief information officer Marcus Cann revealed that while Mogo had first launched in Australia four years ago with an exclusive partnership with Veda (now Equifax), the platform has now launched independently.

The system works by scraping borrower bank statements and then analysing and structuring them within seconds so that a lender or broker can determine spending habits, incomings, outgoings and any potential behaviours that need to be questioned further, as part of their responsible lending requirements.

MOGOPLUS has been working with a range of lenders and broking groups to develop a customisable expense check tool, which can be used by mortgage brokers to help demonstrate their responsible lending and expense checking requirements.

Speaking of MOGOPLUS, Mr Page also revealed that the platform was the first of its kind to meet the ePayments Code, which regulates electronic payments and internet and mobile banking.

According to the company’s head of Australia and New Zealand, because the borrower initiates the expense checking process through the platform (rather than providing online banking passwords to a third-party), the platform is “only provider in the marketplace that is compliant to the ePayments Code in relation to the storage and access to banking credentials”.

“Everything that we do is supported by a brand promise of security, privacy and compliance,” Mr Page told Mortgage Business.

“We’re dealing with sensitive data at all times so we have to be very careful and we’re ruled by those pillars of business.

“But we do not use the credentials in any part of our workflow, nor do we store or access them,” Mr Page added. “And that has enabled us to work over a number of years with two, at the moment, of the big four banks.”

The head of Australia and New Zealand said that there were several benefits of using the system for brokers, particularly given the current scrutiny on expenses interrogation off the back of the royal commission.

Mr Page added that the lenders also benefit as they are able to access the data “in a customised way to see whether it fits their credit policies and decision engines”.

Mr Page suggested that this type of capability, combined with comprehensive credit reporting (CCR) and open banking, will help deliver straight-through processing of loans and instant credit decisioning next year. 

“As the open banking market begins in the middle of next year, the volume of data that will be accessible will increase dramatically and the ownership of the data will formally rest with the consumer (with the consumer data right). 

“It will be the consumer’s decision to control that flow of data into all verticals and the richness of that data and the use of that data for decisioning will be increased,” he said. 

Mr Cann added that MOGOPLUS’ experience of open banking in the UK had identified that “the thing that people miss is that the data that comes out of an open banking environment is unstructured and not really ready for use”. 

“It is only really through the use of systems that can categorise and structure and give the analytics that you really get the insights into consumer behaviour. And so the value that MOGO adds is by grabbing a large amount of data out of the open banking world and getting it into a useful format for the broker and the lender.” 

Mr Page concluded that the company is now working on delivering “predictive analytics” to the mortgage market. As the platform analyses and structures spending behaviours, it could also be used to collate and understand a consumer’s spending patterns and work in a predictive manner. 

“Our journey also includes the predictive analytics that we can produce from our data sets.

“So, beyond open banking and beyond the royal commission and the changes that we’ll see, there is a whole new market opening up around analytics and new services that can be layered on top of the data that is available, so that is an exciting future for us,” he said.

[Related: New technology to speed up loan applications]