Bluestone Mortgages has launched the pilot phase of its Open Banking solution, becoming the first specialist mortgage lender in the UK to incorporate the service as part of its core underwriting process. The pilot will be rolled out to a select group of advisors on Bluestone’s panel with a national launch expected to follow shortly thereafter. The Open Banking solution is supported by a service provided by Experian, the UK’s largest credit reference agency, and will give customers the option to provide their bank transaction data to Bluestone within minutes, thereby significantly reducing mortgage processing times.

Open Banking is the directive driven by the UK competition authorities, requiring major banks to provide access to their customer’s transaction information to trusted counterparties. Subject to a customer’s informed and on-going consent, this information can then be used to provide tailored financial products and assess affordability and other borrower characteristics.

Bluestone has used applicant bank statements for many years to verify application information, but the provision of statements can be cumbersome for customer and lender alike. Open Banking provides a contemporary, digital alternative which is likely to radically reduce decision times, and improve customer outcomes.

The move is part of Bluestone’s increasing commitment to invest in technology within financial services, positioning the lender as one of the most technically advanced in the mortgage industry. Earlier this year, Bluestone was the first lender to fully integrate its loan application and workflow platform BlueLink, via an API with Twenty7Tec’s MortgageApply platform. The business is currently commercialising BluePay and BlueDial, a payment gateway service and computerised dialer designed for small to medium sized businesses.

The news follows a recent series of updates from Bluestone Mortgages, including their entry into the Help to Buy market, enhanced criteria for customers with an Individual Voluntary Arrangement and extending their distribution to include Scotland.

Peter McGuinness, CEO at Bluestone, commented: 

Bluestone is committed to being a technology led specialist lender and proud to be the first specialist lender to deploy an Open Banking service into the core mortgage approval process. We believe innovation that will be made possible with Open Banking is going to change the landscape for specialist lending, particularly in areas of affordability assessment and expenditure patterns, whilst at the same removing a lot of friction associated with a traditional mortgage application process. “We’ve made a significant in-house investment in our IT platform through 2018 with a constant drive to improve the application journey for our advisors., We see Open Banking as compelling; it will provide our customers and their advisors with a significantly more efficient credit application process and give Bluestone access to high quality and timely information from which to support a mortgage approval.”

Tom Blacksell, Managing Director of B2B at Experian, said:

“A customer’s current credit position only ever tells part of the story. People’s financial circumstances are multidimensional and unique and we are supporting our customers as they look to keep up with a diverse and ever-changing global population. Open Banking has the power to help people who have found it difficult to prove they can afford a mortgage, perhaps because they are self-employed or a contractor.

“Experian’s service automatically categorises consented bank account data, so that lenders can assess how much they have coming in and going out each month, all in just a few seconds. Putting this information at the fingertips of Bluestone helps them to make more informed lending decisions in a much shorter time frame. It’s a great example of how the insight from Open Banking can increase financial inclusion and help people to access more affordable services.”