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Mortgage tech is taking up the property market, promising efficiency
Mortgage tech has the potential to tap into the Indonesian property market with demand for house ownership high in the years to come, while most of financing come from loans.
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A subsidized housing-complex in Bogor, West Java, is seen in this file photo taken on Jan. 6, 2020. (Antara/Yulius Satria Wijaya)
T
ech start-ups are taking up the mortgage market by offering a more efficient process compared to conventional methods currently provided by lenders in the financial sector.
They come in the form of what is to be called mortgage tech. Their core business revolves around aggregating mortgages with technology to simplify existing processes and help banks filter and assess credit worthiness.
Services provided by mortgage technology players revolve around two big categories, namely brokerage and financing in which everything is conducted digitally. To execute them mortgage tech start-ups also partner with both banks and property developers.
“Efficiency is an ever-growing imperative,” said Doddy Ariefianto, associate head of the finance program at Binus University, on Friday, regarding whether the whole process of mortgage will be entirely digitized in the future.
Doddy stressed that a certain level of due diligence must be kept despite digitalization as part of common prudence practices in the financial sector.
Indonesian Banking Development Institute (LPPI) senior faculty Moch. Amin Nurdin backed Doddy, saying mortgage tech is a “game changer” as digitalization could cut costs significantly.
“When governed, socialized, educated and promoted properly, [mortgage tech] will be big,” said Amin on Friday.
