An update on interoperability and market structure

Australia’s adoption of digital settlements is the most significant development within the property industry in 150 years.

Since 2014, more than 7.5 million transactions have occurred via PEXA, and today, more than 80% of all property transfer settlements in Australia are processed electronically on the platform.

As a result of this digital-first focus, the Australian property sector has been able to continue to operate throughout a challenging and ‘contact free’ 2020.

In fact, the market Australia-wide has gained considerable momentum post the lifting of COVID-19 restrictions, generating year-on-year sales growth.

The state and territory governments that regulate e-conveyancing have committed to make some changes to accelerate competition.

Known as ‘interoperability’, the changes seek to make it possible for competitors to enable clients to participate in transactions.

Governments and industry are working together to develop national interoperability specifications for current and future Electronic Lodgement Network Operators (ELNOs) to enable providers to “interoperate” with one another.

This work is being led by the Australian Registrars’ National Electronic Conveyancing Council (ARNECC), with PEXA sharing its expertise to help build a workable approach.

Regarding the current market climate, PEXA Chief Operations Officer Simon Smith said, “PEXA is supportive of the progress being made. As at the end of February, key design principles have been progressed for interoperability architectural models that will support diverse and sustainable competition.

“Critically, we believe that customers and users of the system must sit at the heart of the solution.

“PEXA has additionally recommended that the next phase should be dedicated to creating opportunities for ‘hands on’ perspectives from participating subscribers to have a say on the emerging design.”

“PEXA has argued strongly for the continuation of shared workspaces, so that all participants can see what needs to be done to complete a transaction.

We will also be focused 100% on the preservation of member experience and retention of the current very high levels of system stability and security.”

The concentrated work program is ongoing, and PEXA will continue to share updates on major milestones via Property Now – watch this space.

ELNOs have committed to designing technology around the best possible customer journey—how a conveyancer, lawyer or financial institution interacts with ELNOs under interoperability scenarios.