Earlier this year, the fintech lender Nano had been in soft launch phase, after rebranding from its previous name of Verteva.
After securing $33 million in Series A funding from NZ-based Bolton Equities in April 2020, the lender secured an Australian Credit Licence in July 2020 before soft-launching to friends and family in December 2020.
It then started allowing customers to sign up to get priority access to refinance in Australia from April 2021, and has so far approved approximately $30 million worth of refinancing loans.
It has now opened its doors to the general public wishing to refinance their home loans.
It currently only offers loans of between $100,000 - $2.5 million to PAYG customers seeking a loan with a loan-to-value ratio (LVR) of 75 per cent or less.
How it works
The digital lender aims to reduce the time taken to approve loans, with “real-time processing” that can reportedly “assess property valuations, credit history, serviceability and identity in parallel”.
The fintech said it approved a home loan in nine minutes and 41 seconds from commencement of application to unconditional approval last month.
According to the lender, these time-savings allow Nano to reduce origination costs. It says that this cost benefit goes directly back to the customer.
As part of its public offering, it has dropped variable rates for all existing and new owner-occupier customers paying principal and interest to 1.99 per cent per annum from 2.19 per cent per annum.
Similarly, it has dropped its investor loans (principal and interest) to 2.29 per cent per annum from 2.49 per cent per annum.
There are no comparison rates as the lender does not charge fees.
The refinancing offer is the first in its suite of home loan offerings – with the fintech saying it is expecting to launch its platform for new home purchases in the second half of 2021.
The Nano home loan comes with an offset sub account, a Nano Visa card for purchases, Apple Pay and Google Pay, as well as ‘Vaults’ to tuck away money towards any special goals such as travel or a renovation.
It is currently only available directly through the lender.
However, it has previously told Mortgage Business that it would be open to working with third-party partners “who share our vision to change the way mortgages are distributed for the better”.
‘Technology-led proposition puts customers first’
Co-founder and CEO Andrew Walker said Nano’s fully digital model brings fairness by cutting out the ‘loyalty tax’ consumers are paying to big banks whereby discounts are offered to new customers while existing customers pay more.
“Nano’s policy is to always offer the same low rate for new and existing customers. We don’t believe in penalising our customers with a loyalty tax,” he said.
“We encourage borrowers who have been caught by hidden fees, loyalty tax and bad service to refinance with an institution that believes in fairness and transparency.
“Australians will always want a fair price, but those are table stakes in today’s environment. They also want speed, convenience and certainty when going through what has traditionally been a stressful process.
“Our technology-led proposition puts customers first, and our disruptive digital platform allows people to secure a home loan in minutes, not weeks – that means completing the entire loan process through to approval, not just filling in an ‘online application’, which then kicks off a traditional manual approval process,” he added.
Mr Walker added that he expects that 30 per cent of the mortgage market will be digital in the next three to five years, potentially a $100 billion addressable market.
“Not only does Nano offer one of the world’s fastest applications, it’s also simply a better way to borrow, which enables customers to manage their money all in one place, digitally and fee-free,” Mr Walker said.
“On the back of the pandemic, consumer expectations have changed forever. The speed and convenience of digital is now the baseline. There is no turning back now, businesses will either adapt or die,” he concluded.
[Related: Digital lender rebrands, writes first loan]
Annie Kane is the editor of The Adviser and Mortgage Business.
As well as writing about the Australian broking industry, the mortgage market, financial regulation, fintechs and the wider lending landscape – Annie is also the host of the Elite Broker and In Focus podcasts and The Adviser Live webcasts.