Sympli chief executive Philip Joyce
Just days after a PEXA senior executive told investors that Australia’s e-conveyancing interoperability program was “complex and challenged” and should be reviewed, the company’s chief executive told shareholders at its annual general meeting that the plan for the interoperability should be more appropriately described as “a target or an aspiration”.
Meanwhile, the head of the challenger brand trying to break into the e-conveyancing market, Sympli, has accused PEXA of running a misinformation campaign on the issue.
Asked whether PEXA would meet the interoperability timeline set by the Australian Registrars’ National Electronic Conveyancing Council, which administers the regulatory framework for e-conveyancing, PEXA CEO Glenn King would not give a commitment.
Instead, King said the deadline for the next step was a “short window” and a “pretty ambitious timeframe”, and that circumstances were “evolving”.
The move to interoperability was adopted by a group of Commonwealth, state and territory ministers and industry representatives several years ago.
In September, industry participants conducted an interoperability trial involving two refinancing transactions relating to properties in Queensland. Commonwealth Bank and NAB were the participating banks.
ARNECC rated the trial a success, calling it a “critical milestone” and subsequently set provisional dates for the completion of the interoperability rollout by the end of 2025.
Despite this, last week PEXA chief customer and commercial officer Les Vance said the trial confirmed that “interoperability is far more complex to design, execute and build than was presented and assumed at the start”.
Vance said: “The original benefits were significantly overstated and the risk, costs and adverse impacts for stakeholders are significantly higher than represented.
“We remain of the view that the policy is flawed and that the pilot transaction provides a suitable point, still early in the overall program, to have a proper review of the policy.”
Vance also cited commentary from the Australian Banking Association that the interoperability program would not meet banks’ requirements.
The ABA told Banking Day: “Our support for the program is strictly contingent on e-conveyancing transactions under interoperability being substantively the same as those under a non-interoperable framework – that is, customers having access to the same levels of functionality.
“It is not clear to the ABA that this can be achieved under the current framework. ARNECC themselves have stated they are not the appropriate form for detailed information about end-to-end settlement flows and impacts to be developed and shared.
“For banks and borrowers, development of interoperability and financial settlement are inextricably linked and must be considered together.”
Sympli chief executive Philip Joyce said: “What the ABA is saying is that its members want equivalence of transactions – that is, interoperable transactions being no different from on-network [single operator] transactions. The program will deliver equivalence.
“You can think about this in the same way you think about a set of payment rails, where there are large number of parties involved. Interoperability will facilitate an exchange of data. One network does the final financial settlement.
“What I would say to bank executives is that both networks have a regulatory obligation to ensure transaction equivalence for their customers. They should make sure they are getting all the detailed information they need from their network to assure themselves that is being delivered.”
Joyce said the September refinance trial delivered exactly what the parties were looking for and showed that interoperable transactions can be done safely. He said that when ARNECC finalises the date for the next steps in the program, all parties should commit to them, including PEXA.