SYDNEY, May 18 Reuters The 10minute home loan at the tap of a smartphone screen is emerging as the next frontier in Australian banking as rising interest rates quash a pandemicfuelled property boom, eating into mortgage income and renewing focus on costcutting tech.
The Big Four lenders booked blockbuster profit during the COVID19 pandemic due to a leap of nearly onethird in property prices since 2020, but raging inflation brought a shock rate hike this month and expectations of several more.
That has left banks, which make most of their profit from mortgages, looking to automate every step of the loan process and cut overheads such as staffing and real estate to keep growing profit from what analysts say may be a shrinking pool of money.
So far only Commonwealth Bank of Australia CBA, the biggest lender, has put a speed target on its automation drive. It said a fully digitised loan service that went live on Tuesday could process an application in as little as 10 minutes.
But in earnings updates this month, National Australia Bank Ltd NAB, Westpac Banking Corp and Australia and New Zealand Banking Group Ltd ANZ all pointed to automation to offset the impact of a cooling property market.
They39;re incentivised to invest in tech and get up to where CBA is because it drives people online, said Hugh Dive, chief investment officer at Atlas Funds Management, which holds shares of major banks.
They can improve profit without growing their top line.
Citi banking…