What Australia’s Top Lenders All Have in Common

The Australian housing market is at an all-time high. Data provided by CoreLogic reveals that as of July 2021, the total value of residential real estate in Australia has reached $8.1 trillion. To put this into peTheefull:

  • the total value of Australia’s superannuation is $3.1 trillion
  • Australian listed stocks are valued at $2.8 trillion
  • Australian commercial property is valued at $975 billion

The estimated amount of Australian mortgage debt is $1.9 trillion, with 54.4% of Australian household wealth held in housing, which makes this a criticalt important area of business for the banking industry.

The impact of COVID on the mortgage market has been mixed:

  • Banks granting loan deferments for struggling mortgage-holders
  • the RBA lowered cash rates for an extended period

Corelogic estimates nearly 600 000 house and unit sales from August 2020 to the end of August 2021. Given that the RBA has said that the current cash rate of 0.1% will probably remain until 2024, it’s not likely that Australian sales will slow down any time soon.

How to grow your share of the mortgage market

According to data from the Australian Banking Association, CBA owns the most significant percentage of the mortgage market (almost 26%), closely followed by Westpac (23%), then NAB and nearly with almost 15% market share each. Macquarie and ING are the following most prominent players, with roughly and almost 3%, respectively.

It’s no secret that CBA underwent the most significant digital transformation in Australian banking history ten years ago before any other banks started theirs. And from earlier this year, Westpac is set to meet them head-on with their newest digital software release, the customer service hub for mortgages; their market growth has been remarkable since the launch.

In May, the Australian Financial Review reported that Macquarie is being watched by all the other players because of the rapid growth of its mortgage market share, “While it is true that Macquarie 3.5% percent share of the home loan market, its growth trajectory in mortgages augurs well for its broader wealth management business.”

Macquarie’s growth is attributed to its digital transformation project, which began in 2014 for its direct banking business, broker network, and white labelled solution for primary non-bank originators—and the fact that they have made massive improvements in how easy it is for mortgage brokers and their customers to have their loan approved in record time with almost no human interaction, and to secure loan approvals so much simpler than the competition.

Create and deliver an exceptional customer experience through technology

Online interaction is more important than ever in this exceptionally resilient post-COVID mortgage market. Lenders who can provide a simplified and effortless customer experience with digitised documentation, e-signatures, streamlined customer verification, automated income verification, automated credit decisions, e-conveyancing and digital cheques will win a greater wallet-share of first-time buyers, customers wanting to refinance their mortgages or top them up, and real estate investors alike.

The banking landscape has been undergoing significant changes over the past decade. We can see this in the branches, which are increasingly being replaced by mobile and online banking channels (but which are still so crucial to specific demographics and communities). However, some banks have opened their platforms to third-party providers and developers of new services and apps. This enables them to take advantage of new technology innovations and differentiates them from their competitors.

In mid-July, Australian neo bank, Volt, bought the lending platform Australian Mortgage which boasts “instantaneous credit decisions” that yield “fully verified approvals” in less than 15 minutes“. Australian Finance Group (AFG) now owns an equity share in Volt Bank. It plans to leverage Volt’s technology to start offering mortgages along with the other lenders its brokers share.

Newly launched fintech, Nano, also intends to differentiate itself by vastly improving the mortgage customer’s digital experience. Nano’s co-founder and chief executive Andrew Walker said, “We’ve designed a seamless home loan application and approval process. We know, for example, that globally it’s a first – it’s the fastest mortgage approval process in the world, which we’re quite proud of,” says Walker.

In August, CBA’s Andrew Sullivan said they’d be offering fully digital home loans that can be approved in 10 minutes. CBA wants to maintain or improve their current lead, reporting 25.3% of the Australian market in June. And they intend to be as technologically nimble as the fintech are positioning themselves.

NAB’s acquisition of 86 400 earlier this year for its neo-bank, UBank, is also about ensuring they are technologically equipped to offer its customers an efficient home loan offering. ACC chairman Rod Sims said, “Market feedback suggested that while 86 400 is innovative, particularly in reducing the time and effort in completing home loan applications, there are several other businesses with similar offerings … these other competitors continue to bring a similar disruptive influence to the market.”

What it takes to get Digital transformation in business right

With all of the digital transformation projects going on right now, and with their focus on speed and cost, it’s essential to keep in mind data security, system resilience, and performance, and at the same time, be responsible with lending practices.

The Reserve Bank of Australia (RBA) has noted, “Housing credit growth has picked up, with strong demand from owner-occupiers, including first-home buyers. There has also been increased borrowing by investors. Given the rising housing prices and low-interest rates, the Bank will carefully monitor trends in housing borrowing, and lending standards must be maintained.”

This is where Liberty IT Consultants make all the difference to the success of traditional banks needing to modernise or replace their systems and re-engineer business processes to delight their customers and crisis-proof their balance sheet as they grow their share of the mortgage market.

Liberty has been at the heart of the three most significant banking transformation projects for CBA, Macquarie, and Westpac. Liberty’s people are specifically chosen for their breadth of experience in banking products, solutions, and platforms, where outcome success is a non-negotiable requirement.

In a tense, competitive fintech market where 100s of millions have been spent on projects that have slipped their schedule, breached their budget, or missed the mark on realising benefits, Liberty has repeatedly succeeded with project planning and execution and has delivered significant and actual results for their clients. Their secret sauce is a suitable model for each client. Each client is unique, so a mix of scaled agile methodology, waterfall, or hybrid is carefully chosen and adhered to. That is Liberty’s winning formula—based on its core principles of quality, experience, and ethics.

Don’t just take our word for it. Here is what two of our clients had to say about our work:

“We wouldn’t have gotten this far without your help, expertise, and resilience. Thank you for your contribution to our joint success.”

GM from one of Australia’s largest banks

“The 25% increase in productivity and efficiency helped put our project back on track.”

The executive from the financial services sector

Talk to us about how we can help with your mortgage technology projects

Call us on +61 (02) 9238 8094

Or email us:

Follow us on LinkedIn for more news about the difference we make in the world of Banking and Financial Services.

Latest Insights

Liberty IT Consulting Group
ABN: 83 614 846 098


"*" indicates required fields

Full Name*
This field is for validation purposes and should be left unchanged.