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Will FNB’s new app feature disrupt the property game?

FNB Home Finance CEO Lee Mhlongo describes the features of the app, its security, and buyers and sellers’ buy-in.

NOMPU SIZIBA: FNB has introduced an app that enables people to buy and sell property. It’s called the “nav» Home” functionality, and it enables FNB customers to securely list and sell their homes privately to buyers who are likely to qualify for a home loan. It says that this platform of transaction can assist both sides in limiting their costs.

Read: FNB upends estate agent applecart

Well, to tell us how it works, I’m joined on the line by Lee Mhlongo, the CEO of Home Finance at FNB. Lee, just give us a sense of the existing services that the nav» technology offers for your customers, and what this latest technology will add to the transactional life of your customers.

LEE MHLONGO: Thank you. What this nav» Home platform that we’ve developed allows the customers to do is to start the home buying or selling journey from the safety and convenience of their banking app. Within this environment, the customer has a choice of going the journey alone or making contact with a practitioner to help them along the way.

So, effectively, if you are selling a property, this platform allows you to either list the property privately and get access to, say, three million banking-app customers who visit the app, at the rate of one million customers a day, and take the transaction going forward from there, or alternatively to request help from an agent in selling my property, and the platform then [connects one] with an estate agent to put that property up for sale there for a multi-channel engagement.

NOMPU SIZIBA: How does the latest app work, and how does the technology marry buyers and sellers?

LEE MHLONGO: In a nutshell, the sellers have got the ability to list their properties on that website, either on their own or assisted. What we have been doing at the bank is that we are going through a lot of analytical work to try and analyse which customers are most likely to afford a [a home] of our threshold. So when you list your property there, not only is your property being matched against people who qualify for funding, or their bond approval in a way has been checked and they seem to be in that ballpark area.

But you also get into natural people who have gone through the bank – let’s call it regulars on board in the KYC [know your customer], the AML [anti-money-laundering] and such procedures. So it’s a faith environment. As you can imagine, trying to sell a property is quite a tricky thing, it takes time, the people come and check out your property, and in many instances you are never quite certain if these people are who they say they are.

But with this platform when the buyers and the sellers and the estate agents are connected with each other, you can trust that these guys have gone through our typical banking KYC process.

NOMPU SIZIBA: What are the pros and cons for the buyers and sellers in the process?

LEE MHLONGO: Maybe let’s start with the sellers. The sellers now have a choice. They can either opt to go it alone, or they can opt to get an estate agent to take them down the journey. That’s the one thing.

The other benefit is when they engage with a person, they’ve got the benefit of knowing that that person is who they say they are. A while ago there was an issue around practitioners showing up in strange parts of the country, claiming to be bona fide estate agents, and these people were not necessarily registered with their governing body. So if you are an investor who is trying to get to a point where the people who invest on our site are people who have ticked [the necessary boxes] in the industry.

The other benefit is that if you go it alone, there is a potential to share costs.

You are not married to a particular approach. if you choose to start out alone, and later on want to engage with somebody else, that is all up to you. The power is in your hand and in your pocket, whichever way you want to refer to it, right there in the banking app.

What’s in it for the buyers? Well, you’ve got listed properties; you can list a property that is not registered in your name. If the property happens to be in the name of a juristic entity, like a trust, there is a process that you run through to ensure that you have the right to make a listing of properties. So, as a buyer, you know that when a property is listed, that property was listed by a bona fide seller.

We are very excited about this platform, and a lot of trust and care has gone into it. We believe in building a platform for all of the players in the market. That then helps the market much better. We are for the assisted journey. We try to ensure that we just create solutions that help all the players do their best work on a day-to-day basis, including the customer. That’s what we strive for.i

NOMPU SIZIBA: What about security of information as the buyer and seller parties exchange information? How secure is that?

LEE MHLONGO: We use our banking environment. It’s got the Secure Chat capability. What that means is, the same security features that go into logging into your banking app and moving funds between your accounts or moving funds to pay beneficiaries, that same enterprise-grade security that we use for that also fits behind that chat mechanism. People can only chat to you if they meet your criteria. So, as you list the property, you can say: “Listen, I only want to engage with people who are highly likely to qualify for this property,” or filter out people who are less likely.

When you apply that filter, only people who meet those criteria would be able to engage with you. It’s not open for all and sundry to bother you, without necessarily having the ability to qualify to purchase that property. We are taking a lot of trust and care to work on that, and remove some of the things that create unpleasant experiences for our customers, for our partners, in the form of the property practitioners in the buying and selling journey.

So we are playing a role to try and make that road look a little better.

NOMPU SIZIBA: Then, in practice, let’s say if there is something technologically wrong as people try to relate to each other, will a human at FNB then be able to intervene, because this sounds like it’s all done electronically? But, if there is a need, do you have a way of intervening to assist?

LEE MHLONGO: We have a way to intervene if the customer requests it. If there are players in that platform who say, “Listen, I’m now in need of someone to intervene,” whether that someone is ourselves at the bank, whether that someone is a practitioner in the process, we have a mechanism to allow the customers to request that intervention, and we will then step in to help the process.

NOMPU SIZIBA: You have explained to us that you have created this platform where people can either do things on their own or they can engage the services of an estate agent, which is great. For those who are interested, they can go down that route or not. Do you see this particular facility as actually being helpful for all parties, or is it going to bring some disruption to the traditional estate agent industry?

LEE MHLONGO: I think for me the starting point is, if you look at the principles we’ve adopted with this platform, just like all of our historical innovations – and we’ve done quite a number of them – I’ll give you an example. We’ve pushed our digital banking. We’ve got an award-winning banking app. We push our customers to all of these technology-type environments. However, our face-to-face channel is still our biggest sales channel. Now, why is that working for us in this strategy? It means we take away all the sort of essentials that exclude the human experience, and let technology deal with that. But we make room for the human-to-human interactions, because at the end of the day many people are walking around doing whatever it is that they do.

We want to engage with people, but we want that convenience and safety of environment. So we believe this is designed to be a win-win. Will it disrupt the market? I think to some degree there may be an element of disruption. I personally believe that disruption will be for the better if we see better trust coming up in that environment. Some of the preliminary data coming out of this is telling us that some people who were sitting on the fence in the buying and selling journey have come on board because this platform has given them that sort of safe environment to start their journey. And a significant chunk of them have requested to engage in, or like, our property practice, such as estate agents.

So we are very excited. We think let’s be positive. I think it bodes well for the sector, and I think in the long run, when we look back at this, we’ll just say that maybe at the starting point not everybody was on the same page in terms of “we could have consulted more, we could have engaged more”. But when you are launching something new and you are innovating, there comes a period where you have to say: “Okay, let’s deliver the product, and we go from there.” It’s just the start of the journey.

NOMPU SIZIBA:  Let’s talk a year from now and see how it’s gone. Thank you very much, Lee.

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The agents are going to be peeved. Now after a sale, I get to keep my arm and my leg as no agent has made me pay that for commission. South Africa has the most expensive commission rates for property sales in the world. More often than not, Estate agents are people who like second hand car salespersons, are not qualified to do anything else and came into thyme business late in life. e.g. Bored housewives, retired clerks, others who excelled at nothing before, end of career employment to avoid boredom. Who is really the Estate Agents client? The buyer or the seller? And then the most important part of any sale is the high commission rate. No more. Thanks FNB.

End of comments.





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