SINGAPORE – FEBRUARY 9, 2021 –“OCBC has a reputation for innovation,” said Dinesh Suresh, head of digital strategy, consumer secured lending at OCBC Bank. “For example, it was the first bank in Singapore to allow customers to instantly open and use a new bank account. We wanted to build on this by offering ‘instant mortgages’ as the next industry-first. Central to this was a decisioning system that could draw all the threads of the loan application together and weave it into the fabric of an online ‘self-service’ application channel.”
Prior to the implementation, the status quo was that all new home loan applications were manually keyed into the bank’s mortgage origination system called CLOUDS (Consumer Lending Origination Uber Decisioning System). Once approved, a letter of offer was generated for the customer’s signature. All of which was time-consuming for the customer and the process created friction for OCBC.
OCBC worked with FICO to streamline this mortgage application process, which required the submission of various documents to provide evidence of employment, income, financial assets, property details and repayment records. To achieve this, the team had to integrate MyInfo, the Singapore e-government’s one-stop data platform for citizens, run its own proprietary eKYC (Electronic Know Your Customer) over applications, automate policy decisions and allow for a manual review by bank staff.
The integration of MyInfo into the process meant that customer details were pre-populated and mapped to the correct fields in CLOUDS. It also meant OCBC was not required to obtain physical documents to verify a customer’s identity or to separately obtain a photograph. eKYC is essentially performed at this point, however, OCBC also integrated its own proprietary real-time digital KYC to ensure total compliance with its own system and standards.
Decisions about loan size are calculated by looking at numerous factors, such as the regulatory total debt servicing ratio (TDSR) and loan to value ratio (LTV). Income is verified against tax returns lodged with Singapore’s Tax Authority (IRAS), as the returns are also integrated into MyInfo and property valuations are determined using API links to third-party valuers.
Once all the calculations are made and a decision proposed, FICO’s solution passes the application to a direct acquisition officer to review and complete the case. This is to ensure data, valuations and pricing all look in order before a PDF letter of offer is sent for the customer’s digital acceptance.
OCBC’s instant mortgage offering has been very successful in Singapore, and particularly timely. It was fully deployed in May 2020 in the middle of the country’s Covid-19 Circuit Breaker period whereby face-to-face meetings could not take place. During the lock-down period, $700m loans were signed-up, enabling the Bank to maintain strong business momentum. In 2020, 30% of loans were signed-up through this platform.
“Anyone who has ever had to apply for a mortgage knows that it is something you hope to do only a few times in your life,” said Nikhil Behl chief marketing officer at FICO. “Transforming this experience into something faster and simpler shows that OCBC identified an opportunity to change the customer journey for the better.”
For its achievements, OCBC won a 2021 FICO® Decisions Award for customer onboarding & management.
“The modern consumer gravitates towards companies that can make doing business as conveniently as possible,” said Tomas Klinger, decision science and data director at Home Credit China and one of the FICO Decisions Awards judges. “You don’t see these types of banking innovations that often for mortgages as it requires more data collection and very accurate analysis. Creating a 60-minute mortgage application service is exactly the type of offering that gets consumers recommending a bank to their social circle. The judges were impressed with the innovation and commitment of OCBC to modernizing its business.”
Re-disseminated by The Asian Banker