Alex builds disruptive personal lending platform on Microsoft Azure
Personal lending disruptor, Alex, is building its business on Microsoft Azure, starting with personal loans delivered through an end-to-end digital process designed to offer the service from application-to-funding in three hours.
A completely digital business, Alex launched its personal loan product last year and has attracted around 600 customers. The firm plans to use the richly featured Azure platform as the foundation for a full service digital bank.
Leveraging the Temenos banking platform, itself built on Azure, and with support from Lab3, Alex’s personal loan solution leverages straight through processing, and being cloud based can be accessed from any device, anytime, anywhere.
Application information is collected from different services, to eliminate the need for the customer to upload, email or scan copies of documents such as payslips or bank statements. Azure facilitates Alex’s specially designed risk-based pricing model by collecting, combining, and categorising this information that a would-be customer provides and rapidly determines whether to approve a loan based on the individual circumstances of the would-be customer.
Chief Technology Officer John Heaton explains that, “We use technology to simplify and secure the entire application process for the customer.” Alex also uses biometrics, matching standard identity documents to the applicant confirming and validating identity. Azure’s serverless technology enables seamless integration between 3rd party services and the digital loan application.
“If you look at the whole process end to end, it’s less than five minutes and that’s an entire application,” said Heaton. Using data to develop a simple, fair, and fast experience is core to the use of technology within Alex. Being granted a restricted banking authority enables Alex to participate in Open Banking to further enhance this process for potential customers.
Azure’s cloud-based platform has allowed Alex to operate lean – it has just 35 staff – and keep costs low. At present there are no fees, late payment fees, or charges for repayment of a loan faster than the original term specified.
Heaton said that Microsoft Azure had been selected for the breadth of its services, access to skills, advanced capability in artificial intelligence and machine learning, as well as the platform’s resilience and security which was critical to satisfy regulatory requirements.
Azure’s reach, performance and scalability is also critical says Simon Beitz, Chief Executive Officer.
According to Beitz, “There is genuine white space for somebody to come in and provide empathetic, customer driven, better banking experience.
“We aim to secure approximately three per cent of the prime consumer lending market in Australia. That’s a big, hairy, audacious goal. And to do that, we need partners in technology that are really going to help us scale quickly but also simply and effectively.”
Phil Goldie, Director Small, Medium and Corporate Business, Microsoft Australia said, “We are delighted that Alex has selected Azure for its digital foundations. We are seeing technology totally transform financial services here and around the world – and consumers are increasingly expecting to have a streamlined, stress free experience.
“Open Banking has arrived and I strongly believe we are going to see innovation ratchet up rapidly in financial services. Microsoft Azure provides Alex with a trusted, high performance platform – as well as access to a rich Microsoft technology ecosystem – that will help it with its impressive growth ambitions.”