Currently there are two operating Electronic Lodgement Network Operators (ELNOs) in Australia – Sympli and PEXA – electronically processing registry document lodgement and property settlement transactions. Currently, all parties to conveyancing transactions must use the same ELNO to complete the transaction. Interoperability is a solution to allow different ELNOs’ systems being able to communicate with each other to complete a property transaction.
For multi-party transactions. Interoperability allows the ELNOs to communicate with each other and for conveyancers, lawyers, banks and relevant government institutions to use their ELNO of choice whilst transacting with parties using another ELNO in a seamless and streamlined fashion for the user.
Why is interoperability important?
Interoperability is not just about technology, it’s about people being able to work together and collaborate across providers. Interoperability is important because it brings choice, competition and better value to the customer.
Interoperability thus supports customer choice and is crucial for a competitive market. Interoperability delivers efficiencies and value for customers in this market by providing a complete, compelling and innovative ELN service nationally.
Key industry stakeholders have been working together in various forums since late 2018 to consider how all this could work, with key dates for the implementation of a secure national interoperability framework set out as follows, as per the Ministerial Directions Statement published last week (29 October 2021):
- February 2022: NSW to introduce changes to the national law into NSW parliament
- Q3 2022: Commence with ‘Day 1 transaction’ (a limited scope refinance, not available in the market generally)
- Mid-2023: all interoperable transactions functional will roll-out across jurisdictions, commencing in the second half of 2023.
How does interoperability affect our community?
- Practitioners have been calling out for competition for some time, particularly as mandated e-conveyancing was introduced across states.
- A competitive market will deliver better value and service for conveyancing practitioners and financial institutions.
- A competitive e-conveyancing market will be beneficial the Australian market and consumers, allowing products and services to be benchmarked and compared.
- Multiple ELNOs will result in improved service delivery, enhanced product offerings and innovation.
- Competition will increase participant confidence in the e-conveyancing market and help accelerate adoption.
Benefits of interoperability when fully implemented
Interoperability solves for the need for all parties to a settlement transaction to be Subscribers of the same ELN. Interoperability gives a practitioner who is connected to one ELN the ability to engage in an e-conveyancing transaction with another practitioner or financial institution connected to another ELN.
It avoids the need to manage transactions across two software platforms or co-ordinate for all parties to agree to use the same platform. The result is access to competition which will bring the benefits of innovation, efficiencies and choice to conveyancing transactions.
To further enable user access to such benefits, the attention of policy makers is beginning to turn from the importance of interoperability to the potential costs to users of switching to the ELN of their choice. The open use of Digital certificates is one such area of interest which will be explored in detail in our next blog.
What would be the cost to consumer/industry if interoperability were not implemented?
Australia’s housing market is now worth more than $9 trillion. Buying a house is one of the most emotionally charged financial transactions most people conduct.
As we’ve seen in recent months, having only one network in this vital and valuable sector, makes the entire market vulnerable if that one network fails. Whilst the current monopoly ELNO remains without access to competition driving efficiencies, innovation and resilience, the cost to the conveyancing industry is immeasurable Simply put, without Interoperability, there is no genuine choice in one of the most significant economic markets in Australia.
To further discuss how interoperability will enable you to provide better value and service to your clients please get in touch. Hello@sympli.com.au
We have a list of frequently asked questions on Interoperability here