An end-to-end system needs the collaboration and coordination of the industry, not individual players.
Mark Dryden is business development director at 360 Dotnet
I always liken that technology within the financial services sector is no different from the industry it supports, fragmented and often disparate.
Technology is fundamentally the great disintermediator of our time and often the product of innovators who recognise the opportunity to apply technology into areas that reduce effort or ease the burden of typically dysfunctional processes.
The reward for such foresight and entrepreneurship is the opportunity to supply the traditionally poorly serviced intermediary market and extract value commercially.
But far from moving towards a true end-to-end system, from introducer to broker to an advised and successful outcome, we continue to add more effort into the process where we should, in fact, be looking to reduce and consolidate. After all, isn’t technology supposed to make things easier?
The accepted (and correct) position is that the broker should hold a “the single version of the truth” through their CRM, utilising integrations into services that provides specialist and qualified information (sourcing, ID verification, due-diligence materials, Open Banking, etc.) to eliminate the large amounts of rekeying between systems.
This places the adviser in a stronger position to efficiently service their clients as they are best placed to pull together the various activities required into one location, however, much of this effort tends to be duplicated or poorly valued downstream leading to the lamentation of a true end-to-end system.
To achieve this, it is not brokers or technology providers or lenders who would bring together that end-to-end system, but all three for it needs to be a solution that creates value for the client, the broker and the lender.
It should be a system that allows clients to easily interact and record identity verification at the onset or Open Banking data that is then referred to by the broker up to the lender, it should allow brokers to research and gather items in a trustworthy and verifiable manner to present into the underwriting process, and it should allow lenders to easily digest and verify the vast amounts of qualified information to provide that speedy and successful advised outcome.
Independently this can be slowly achieved but it needs far greater coordination and a coming together to realise such a reality because the technology already exists today.
Distributed ledger or blockchain, the functionality that powers Bitcoin, provides the perfect infrastructure to achieve that end-to-end system.
Not in terms of dealing with financial transactions, although this can be easily included and layered with smart contracts, but being able to record and secure information and data during the process and referred to throughout.
It creates a single chain of activities for each transaction where all parties play their part before handing over from one to the other, a chain that cannot be changed or amended after each interaction, and one that is not that “single version of the truth” but shared to everybody in “multiple versions of the same truth”.
An end-to-end system needs the collaboration and coordination of the industry, not individual players, otherwise, we’re likely to find ourselves back at square one wondering why there’s still too many systems…
