How low-code compounding transformed lender Pepper Money

You can get a measure of a man from how he describes his job. When Steven Meek, CIO of Pepper Money, speaks to us from the company’s state-of-the-art headquarters in Sydney, Australia, the workday has gone well. Many of his colleagues return home and a well-meaning cleaner vacuums the sparse office. Still, Meek is brimming with enthusiasm for the role he plays, describing his work as if it were an honor, not a calling.

“It’s great,” he said. “I feel privileged to lead a very talented team, working on digital transformation, data and analytics, and core technology services and solutions. I have been fortunate throughout my career to have worked in multiple industries, from IT services and consumer goods to investment banking, helping every company I worked for through times of major change.

This description is no less applicable to Pepper Money, which Meek joined in 2021. Founded in 2000, the lender began with mortgages, focusing on customers who could not access financing through traditional means – whether it was because they had a flawed credit history, unpredictable income habits or a life event that changed their financial situation. For more than two decades, Pepper Money has steadily strengthened its lending solutions with new offerings covering homes, cars, electric vehicles (EVs), equipment, asset finance, commercial real estate and loans. personal.

“As a company, we have industry-leading turnaround times, innovative technology established over many years, and a team of over 1,000 people who have helped 327,000 customers from all walks of life,” Says Meek. “We are now one of the largest and most trusted non-bank lenders in Australia and New Zealand.”

Out-of-the-box solutions in place were not working

Pepper Money’s rise is based on the fact that, to some extent, it has avoided some of the legacy issues that plague incumbent lenders – in part because, as a relatively young and nimble organization, it has managed to limit its exposure to legacy technology. Today, 90% of its digital architecture runs through cloud and SaaS platforms, ensuring a balance between resilience, agility and profitability. Every lender tries to make that application experience faster and more seamless, Meek says, but success still relies heavily on manual processes for many.

“Our digitization journey started in 2018 when it was clear that we were facing an increasingly digital and competitive market,” says Meek. “We recognized early on that our out-of-the-box ready solutions in place needed to be redesigned. The strategic review of our digital architecture and the unpacking of all our front-office and back-office processes have been a major priority. As part of this, we made the decision in 2019 to look to composable and low-code digital solutions to rapidly transform our origination channels and increase the level of innovation in the employee and customer experience.

Among the new capabilities being invested, Pepper Money has partnered with Appian, the US-based software company, to completely redesign its digital architecture. The digital asset finance origination platform it built, Solana, has driven a 70% increase in business volumes and brings Pepper’s proprietary credit decision capabilities to the forefront, using AI-powered analytics for automated approval.

“Our existing solutions were hosted on-premises, lacked flexibility, and as a result were not responsive enough to the changing needs of a rapidly growing and diversifying lending business,” Meek recalls.

“We needed something that could scale at pace and had all the benefits of cloud-only elastic scalability and security. We wanted something that could activate a market for acceleration solutions, that would allow us to harness innovation much faster than we could do internally. All of these factors and the global scale Appian was able to bring contributed to the partnership we enjoy with them today. »

Pepper Money takes advantage of low-code composition

For Pepper Money, the advantages of low-code platforms are fourfold. The first benefit is obvious: low-code builders allow businesses to significantly reduce their speed to market, which in Pepper Money’s case is the time a consumer waits for approval. No one applies for credit to experience delays and denials, so making quick and informed credit decisions is essential.

Appian also offers the lender seamless integration with existing infrastructure, because by obtaining this right, Pepper Money is able to coordinate complex workflows involving many systems without exposing those systems directly to the end customer or employee.

“Once again, the key is ease of use,” adds Meek. “Appian’s building blocks and accelerator components mean we can accelerate time to market without having to build from scratch.

“The final benefit is what we call talent resiliency, and to be honest, we haven’t tapped into the full potential of that yet. We recognize that the longer-term benefit of low-code is to enable the citizen development, where business teams with basic computer and coding knowledge can build apps, workflows, and processes in minutes.

Innovation is at the heart of Pepper Money’s culture

In today’s world, where consumers and businesses must deal with soaring food and fuel prices, lenders play a more central role than ever. Innovation is key if lenders like Pepper Money are to keep pace with the needs of their customers.

Meek explains: “Like many economies around the world, the combined effect of rising inflation and rising interest rates means that our clients, brokers and introducers are facing a period of uncertainty. It’s a critical time right now for people to have peace of mind, quick decisions, and flexible loan options. From a digital and technology perspective, this means speed of decision-making, access to self-service options, transparency throughout the digital journey, and more automation for our internal employees – all of which are crucial right now. to help our customers meet these challenges.

As an example, he cites Pepper Money’s average loan approval rates reported last year: an impressive 85% of all mortgage applications are approved within a day, and 42% of Asset financing are automatically approved – made possible by Pepper fully embracing automation technologies. Rather than resting on its laurels, the lender continues to explore new uses for technology and realize new cost savings.

“Our continued investment in technology innovations – like smart document scanning, digital signatures, biometrics, automated assessments, digital income verification and things like AI-based analytics for our credit assessors – will continue to enable us to evolve our products and serve customers in the future.”

From a front-end perspective, this also means benefits for Pepper Money customers. With its digital self-service platform, they can easily view their payment amount, download statements, and control payments all in one place. There is also a set of personalized communications that keep them informed throughout their credit journey.

Towards a clear vision of the future

As Pepper Money continues to grow and prosper, it will look for new potential to add value. For example, in electric vehicle financing, Pepper Money recently partnered with Evie Networks to offer customers who finance their electric vehicle with Pepper Money a public charging subscription plan for 12 months at no cost.

“People come to Pepper for a purpose,” Meek says. “It’s more about the overall value we can offer them and the service we provide, more than just price and credit.”

“We will continue to invest in technology as the backbone of our business process management, creation, maintenance, customer service and enterprise capabilities. We want our clients, brokers and introducers to have a fast and frictionless experience, and we want our employees to have the same. They need to have confidence in the data they work with and they need to feel able to successfully navigate our increasingly digitized processes. The low-code, cloud-first platforms we use are fundamental to continuing to ensure that we can scale effectively as a business into the future. »

“Over the next 12-18 months, we will be focused on leveraging all available continuous innovation opportunities, ranging from leveraging Open Finance to enable new services and smoother customer experiences, to rapidly expanding our use of automated identity verification and in pursuit of real-time analytics integration that allows our employees to have the necessary information at their fingertips that drives pricing, products and customer decisions faster than ever before.

Clearly, the proof will be in the customer experience. Beyond transparent pricing and a range of products that resonate with them, the main thing applicants want from lenders during the application process is a quick decision and a clear rationale for any decision. Pepper Money has already served 327,000 customers; now he hopes his roadmap for the future will allow him to empower even more clients to succeed.

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