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With the revelation that the bank will roll out an online-only mortgage, the bank has told brokers it expects the offering to“complement” existing distribution channels.
On Monday (20 May), The Adviser broke the news that the Commonwealth Bank of Australia (CBA) is set to release a new direct-to-consumer refinance offer that will only be available online (and not through brokers or proprietary bank staff).
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While details of the new Digi Home Loan product have not yet been released, it is believed that it will be targeting borrowers with a loan-to-value ratio (LVR) of under 80 per cent.
Members of the broking community have been left frustrated and disappointed at the decision by the bank’s move to seemingly undercut the broker channel (and its proprietary bank channel) by offering the loan product directly to external refinancers seeking a better deal online.
However, CBA’s executive general manager, home buying Michael Baumann has written to brokers this week to assure them that the Digi Home Loan is meant to complement the bank’s existing offerings.
In the note, seen by The Adviser, Baumann said that the new “basic featured mortgage product” – which will be debuted “later this month” and only be available to eligible customers refinancing from another financial institution – had been designed to cater for “a segment of customers who are actively seeking a digital-only lending experience”.
He said: “At CommBank, we recognise that many customers still want to talk to someone and will continue to prefer the face-to-face support and guidance that you – our brokers – provide, and we expect this to continue into the future.
“We see our new digital home lending solution as a complement to our existing distribution channels. The broking channel remains an integral part of our business.
“As Australia’s largest lender with the highest volume of broker-originated loans, we remain committed to this channel – which is evident from the ongoing investments we have made (and continue to make).”
He said that CBA would soon launch “tech enhancements” to “deliver greater business efficiencies” for both brokers and their customers, noting that these come about following a range of tech updates, including the launch of Your Applications, the recent upgrade of its home loan pricing tool, and enhancements to the Your Loans self-service tool. The bank also became one of the first to integrate open banking data in ApplyOnline for brokers when it turned on open banking last year.
“Beyond this however, I would also like to thank you for your ongoing support. At CommBank, we’re committed to providing you and your customers with superior products, services and outcomes, and welcome any feedback you may have,” CBA’s executive general manager, home buying, said.
[Related: Broking industry frustrated but unrattled by CBA move]
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