CUSTOMER EXPERIENCE: HOME LOAN AI
MOVING
FORWARD UK lender TSB and Australia’s Sandstone Technology have both seen artificial intelligence come to the fore during one of the most volatile homebuying periods in history. The bank’s Mike Gamble and Sandstone’s Ross Watts swap stories
There’s no place like home, but millions of us were desperate to change ours when the world was told to stay indoors. Eight months after the first UK lockdown in 2020, demand for mortgages was at its highest in 13 years. Breakneck property sales were still going strong the following autumn, with spiralling house prices defying the rules of normal economic activity, as a set of extraordinary circumstances combined. Near-zero interest rates, low inflation and fiscal and monetary policies designed to support the economy and the property sector in particular, a demographic shift as working from home became the norm for many, and household savings accumulated from months of restricted activity, all conspired to create the boom. On the other side of the world, a similar picture emerged. In Australia, where, if anything, COVID restrictions were even more severe, house prices in Sydney rose by 15.1 per cent in the first five months of 2021 alone; Melbourne, which endured the world’s longest lockdown, saw a 9.4 per cent increase over the year. By the end of 2021, there were more home loan applications in the system than at any point in the last decade. The public’s sudden desire to up sticks and move left many financial institutions in both countries overwhelmed; such hot ffnews.com
property markets put direct and collateral stress on banking systems and forced lenders to look for ways to stay ahead of the game. TSB Bank was one that massively benefitted as the UK packed its belongings into removal vans because the lender was digitally well-prepared for the challenge. Remembered by many in the UK from its 1980s advertising slogan, ‘the bank that likes to say yes’, TSB had been forced to rebuild both its reputation and its IT infrastructure following a disastrous tech migration to new owner, Spanish bank Sabadell, in 2018, when millions of customers were locked out of accounts for weeks. And, as average house prices increased by 10 per cent over the year, TSB kept pace with buyers and said ‘yes’ to the tune of a record £9.2billion of gross mortgage lending. By placing an emphasis on digital, it had built what is widely acknowledged as one of the most modern banking systems of any high street lender – although, critically, as Mike Gamble, director of analysis and design at TSB, stresses: “The human element of banking is really key to us and how we connect the digital world to the human world is absolutely front and centre for TSB.” Ross Watts, chief customer officer of Sandstone Technology, whose LendFast platform processes about 20 per cent of all home loans in Australia, couldn’t
agree more. There, processing staff, in addition to dealing with the sheer volume of business, were also under pressure to stay on the right side of compliance after a series of scandals that had seen major lenders fined for sending billions of dollars to operations overseas without appropriate governance – errors that, Watts argues, could have been avoided by using AI. In both TSB’s and Sandstone Technology’s cases, AI has been the answer to meeting the needs of customers during a pandemic, in a fast, compliant – and human – way. It could take care of the hard stuff in the background by making processes more efficient, while freeing up people to deal with issues that require personal interaction – to the benefit of the banks and customers alike. The jewel in TSB’s digital crown is its AI-driven TSB Smart Agent, developed with IBM and launched in the mobile app within just five days at the start of the pandemic to give customers immediate access to measures such as repayment holidays for mortgages and loans. The live chat service – which uses IBM Watson’s natural language processing and is powered by LivePerson – answered more than 40,000 customer requests between March 25 and May 1, 2020, alone, using a combination of virtual assistant and employees. Issue 11 | ThePaytechMagazine
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