Tuesday, August 9

Becoming your personal online financial advisor


While this was great for Lim as more people would be searching for financial solutions online, it also meant that there would be more competition for Loanstreet. To stay relevant in the cut throat world of fintech, he knew that Loanstreet had to be more than just a simple loan comparison website.

KUCHING: It does not matter if you are a savvy business person or a fresh graduate – at some point, we all had to take the first step in educating ourselves about financial literacy.

These days, you only need to Google ‘best loans in Malaysia’ and you can find a plethora of online resources that will automatically show you what the best loans and credit services are, calculate your repayment schedule and even simplify the application process for you.

One person behind this is Jared Lim, founder of loanstreet.com.my (Loanstreet) – one of the first Malaysian financial product comparison websites.

Traumatised by the cumbersome process of selecting a suitable loan himself, Lim was one of the first few Malaysians that said ‘no more’ to our, then lack of, loan comparison resources.

He shared with The Borneo Post that the idea of Loanstreet came about when he rushed to buy a home for his family when they fell on hard times.

“In 2009, my family had to sell our home under pressure to cover a portion of debt repayments. In a hurry, I purchased a basic apartment in case we found ourselves out of a home before we had to move out.

“It was a really tough time for my family which has had a major impact on my life until today.”

Having never purchased a property before, Lim described his early experience as being extremely stressful as he found himself struggling to research what suitable home loans were out there for him while being saddled with growing pressures of his work life.

“Worst was that online resources fell short. I just wished for a website and service that I could have used to research and educate myself,” he lamented.

That was when the idea for Loanstreet started but it was not until Lim saw from the point of view of banks and financial institutions before he started taking it seriously.

“Eventually, I joined an IT solutions provider to banks as a consultant and learnt about banks’ side of the equation, which convinced me of the viability of building a service around helping people with limited knowledge make an informed decision when applying for a loan.

“Consequently, we incorporated Loanstreet Sdn Bhd which is now known as Finology Sdn Bhd (Finology) in October 2010.

“In the beginning, the project moved slowly whilst I saved up money for two years and worked with an outsource programmer part time to get the initial website up. I eventually left employment in March 2012 to work on it full time.

“And so, that’s where I started. Loanstreet was there before any other comparison websites were established,” he shared.

Being one of the first few in the industry, Loanstreet was an instant hit with internet-savvy Malaysians as it provided a one-stop solution for comparing loan products and interest rates. It also helped spark the push for more fintech products and services.

While this was great for Lim as more people would be searching for financial solutions online, it also meant that there would be more competition for Loanstreet. To stay relevant in the world of fintech, he knew that Loanstreet had to be more than just a simple loan comparison website.

“For the longest while, as a bootstrap start-up, we were up against better funded and better staffed competition which went into very broad category comparisons. Without that much cash behind us, we first took a niche approach by going inch-wide and mile-deep on mortgages and home loans, focusing on advisory.

“But over time, to stay relevant, we started expanding into more consumer credit products like credit cards, personal loans & ASB loans. We also built up many credit focused tools, such as our very popular Home Loan Eligibility Check for 15 banks that helps the public know how much loan they can get instantly.

“This journey of re-invention will continue even as we add on more product categories but you can still see the DNA of how we first started in our website today,” he said.

While Finology now works with several local banks on providing loan eligibility checks for consumers, Lim shared that the journey to getting our traditional financial institutions to cooperate was tough, at first.

“The initial going was hard. They (banks) took a long time to buy into the concept of working with aggregators and many of them today are still going through the learning curve of how to convert leads originating online.

“But the amount of people in Malaysia buying a financial product online is still small in comparison to traditional channels. So, the potential for growth in this area going forward is huge,” he said.

Finology’s persistence in getting the approvals from banks eventually paid off. It now sees collaborations with Hong Leong Investment Bank Bhd (HLIB) to introduce investment products such as Share Margin Financing and other insurance and wealth products down the line.

The Finology brand has also capitalised on its technology built up from Loanstreet and has since branched out from just servicing regular consumers to targeting businesses in the banking, property, automotive and insurance industries. Loanplus – one of its flagship businesses – features a Loan Score Report which allows anyone to know their loan eligibility across 15 banks in Malaysia in just 10 minutes.

“The loan application is scored taking into account a customer’s CTOS and CCRIS records, various different scenarios including product types, joint applicants, pledged collaterals, different sources of income, and even factor in the inclusion of guarantors, to produce different results for every bank.

“With a loan score report at the point of sale, property merchants have found that it helps customers and agents alike to make an informed decision whether to proceed with a purchase. We intend to also extend this service to automotive merchants in the future,” Lim explained.

According to Finology, its current clientele for Loanplus included high profile developers such as Huayang Bhd, Paramount Corporation Bhd, IJM Corporation Bhd, LJBB Group and Leadmont Development Sdn Bhd.

“That aside, under Fincon (our fintech consultancy business), we’ve been coming up with some pretty amazing stuff for the insurance industry too. We’ll be headed to Singapore to setup a POC for an international insurer in the coming weeks to demonstrate our new modular ratings engine. Our technology enables rapid setup of new generation modular insurance products,” he added.

From a small start-up to a personal online financial advisor and solutions provider, Finology has come a long way and has made its name in the local fintech industry.

“As founder and (still) chief executive officer of the Finology Group, I expect Loanstreet, Loanplus, and Fincon to each grow up as connected and synergistic, but somewhat independent businesses. We’re making plans to get ourselves outside of Malaysia because we believe we have a lot to offer as a company.”