dfinanz is a confluence of an eBay-style marketplace, a Facebook-style social network and sharemarket-style price discovery mechanism.
The platform allows users to see what other people are paying for their mortgages and decide what they want to pay based on this information.
This is their ‘fair rate’ which they can upload to the dfinanz marketplace, where lenders can interact with them and make offers to lend at that interest rate.
From a technology perspective it’s a finely calibrated ecosystem of three platforms and three distinct user groups, all drawing from the same data repository but extracting different information.
From a consumer perspective, it’s about uploading fair rates and inviting interaction with lenders.
These users need a publicly viewable marketplace to give them price discovery and a social platform to share information.
The second group is the lenders, who need a lot more granular data, such as individual loan-to-value-ratio calculations and postcodes, to give them enough information to find sales opportunities that are attractive to them.
And the third group is the administrators (us), who facilitate the flow of information from users to lenders while maintaining anonymity and security.
We developed the architecture of the systems here and used partners in Spain to write the code, which gave us cost advantages over doing it locally.
The time difference has also allowed us to develop the business during the day and work on the tech development in the evening, which sped up our time to launch significantly.
The monitisation is obviously in the interaction between user and lender, but the social aspect of dfinanz is extremely important.
Firstly, it regulates behaviour – lenders who deliver great service, or conversely who do not, can be talked about on our social network and others.
It’s also valuable for users who can take the information and use it even in regions where we don’t yet have the licensing to facilitate loans.
For example, while our platform was not yet executable, a friend of mine took a data dump of the marketplace and took that to the bank he was with. He said, 'look, I’m paying 4.7 per cent on my mortgage but this person is with your bank too and they are only paying 4.3 per cent'.
And he refinanced on the basis of that before we were even up and running. This is an example of the broader social benefits of price awareness that publicly available marketplaces like dfinanz can deliver.
It’s also useful for us in planning our growth trajectory. We can see where the highest levels of activity are – for us it’s actually South America, which has been a big surprise but has given us a clear signal as to where we might go next.
Peter Coco is the founder of mortgage refinancing company dfinanz.
