New online lender OneTwo expecting $100m loans
ANZ’s external venture capital operation has done what the bank could not: launch a successful home loan business expected to hit $100m in lending in coming weeks.
OneTwo Home Loans, which launched in early March, is passing on only 20 basis points from the recent Reserve Bank rate rise to customers in a bid to win business.
The lender is seeking to grow its loan book, offering low rates to borrowers and discounts to those who pay off loans early. Borrowers are offered a discount for every 5 per cent of a loan they pay off.
OneTwo recently launched into SA, and plans to start writing loans in Victoria and NSW this week.
The lender, which is being backed by ANZ’s external venture capital and innovation partner 1835i and the Lendi Group, owned by Commonwealth Bank, is aiming to grab a slice of the lucrative Australian home lending landscape.
OneTwo chief executive Derek Sheerin said the lender hoped to prepare customers for “several rate rises to come” by only passing through a smaller rate rise now.
“Our view of the broader market is that it’s clear that we are facing an inflationary environment, with a risk that this inflationary period could be persistent for some time,” Mr Sheerin said.
“We think it’s of utmost importance that lenders do what they can to help their customers through this next period.”
Lendi is OneTwo’s distribution and technology partner, with the lender working with the online broker platform to provide real-time credit approvals to borrowers.
Mr Sheerin said the loans platform was similar to the Lendi experience, but had more feedback for borrowers.
“Our idea was to create gamified financial products to help people in the real estate market,” he said.
Mr Sheerin said OneTwo, unlike many others in the online lending world, held all its own technology internally on one platform.
“Today when you’re in the technology world people buy other people’s technology and stitch it together,” he said.
“Those companies have to fit their vision and technology to what they buy. We’ve built our own platform. It allows us to have a much lower cost …”
Funding for OneTwo’s loans is provided by 1835i, but loans will be held on the company’s balance sheet.
OneTwo joins a jostling throng of online lenders, such as Tic: Toc, Athena and Neo, some of which have moved to whitelabel their products for other lenders.
ANZ, among several major lenders, has been stung by boated wait times for approvals, which blew out to more than 32 days on average for some borrowers and as much as 10 for first home buyers.
However, Mr Sheerin said he had no plans to whitelabel the loan product and was in no rush to list the business.
“Our immediate focus is to scale the platform and prove our product,” he said.