To continue reading the rest of this article, please log in.
Create free account to get unlimited news articles and more!
Nano Digital Home Loans has told customers they will move Nano and Connective Affinity Home Loans to AMP Bank effective from 27 March 2023.
The technology provider and lender has said in a statement on its website, the business “has evolved to being a provider of global leading technology to financial services companies. We are no longer providing a Nano home loan product”.
“We have made the decision to transition your home loan to AMP Bank,” Nano wrote.
Nano customers will transition to AMP Bank on a comparable product and maintain their current interest rate.
Nano’s mortgage book consists of primarily owner-occupied, principal, and interest loans with the acquisition estimated to bring $400 million in loans to AMP Bank’s residential mortgage book.
Given AMP Bank and Nano’s partnership in May 2022 to deliver a digital mortgage offering, AMP Bank group executive Sean O'Malley said the opportunity to acquire their direct-to-customer loan book “aligned well” with the bank’s strategy.
“We’re pleased to welcome Nano’s customers to AMP Bank, and we look forward to continuing to support them with competitive interest rates, strong customer service, and provide access to more banking products to help them achieve their goals,” Mr O'Malley said.
“The continued strong growth of AMP Bank has been largely organic, driven by investments in our service, digital capabilities and competitive offers to attract new customers, particularly through the mortgage broker channel.”
He added that in line with the bank’s objective to grow, it will “continue to consider acquisition opportunities”.
Nano to focus on technology
The agreement also delivers on Nano’s strategy to focus on being a provider of technology to financial services companies rather than a home loan provider.
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 had previously said it approved a home loan in nine minutes and 41 seconds from commencement of application to unconditional approval last month with the cost-benefit delivered to the customer.
Treasury flags neobanks ‘gone to wall’
Meanwhile, the government has tipped start-up models based on near-zero interest rates have pushed some businesses over the edge.
While the Assistant Minister for Competition, Charities and Treasury, Andrew Leigh, has sympathised with the thousands of Australian mortgage holders who are facing a “big challenge” amid rising interest rates, he also warned of the threats to businesses.
“We’re already seeing that in the business sector, some of the neobanks appear to have had a start‑up model that was really based on near‑zero interest rates have gone to the wall now,” Mr Leigh said.
The comments came as inflation hit a 33-year high in the December quarter 2022 and economists expect the Reserve Bank of Australia (RBA) to lift the cash rate by a further 25 bps (at least) on Tuesday (7 February) as spending continues to weigh on inflation.