The UK’s first digital mortgage settlement has been carried out by Premier Property Lawyers and Shieldpay, bringing transformation to the £245 billion mortgage market.
Premier Property Lawyers has used Shieldpay’s digital escrow facility to power the settlement, which is designed to reduce the cost of liabilities associated with customer due diligence checks and the holding of funds for all parties involved in the mortgage process.
As such, it aims for business operations in conveyancing firms to be more efficient and grant consumers a more streamlined process and further visibility over their money, completion date, and moving day.
Peter Janes, founder and chief executive officer of Shieldpay, said individuals and businesses have had to engage in “unnecessary complexity” when sending and receiving sizable funds, as well as a lack of transparency over the status of the transaction.
“We only have to look at the size of the mortgage market in the UK as an example to understand the benefits for enterprises and consumers of a completely digital payments process,” he said.
Shieldpay’s payment solution – fully authorised and regulated by the Financial Conduct Authority – lessens the risk of fraud by verifying the identity of all parties, holding funds securely and only releasing funds when all sides agree.
The law firm subsidiary of both Shieldpay and My Home Move garnered support from Barclays and the specialist regulator of conveyancers, the Council for Licensed Conveyancers (CLC).
According to John Stecher, chief innovation officer at Barclays, Shieldpay has improved the efficiency of digital payments in a ‘truly innovative way’.
He said: “The team has put a huge amount of effort into creating a bank-grade payments platform that will change the way that people buy and sell valuable goods and services. They are definitely one to watch in the UK fintech industry.”
Doug Crawford, chief executive officer of My Home Move, added: “Having completed the first residential property transaction with Shieldpay, we can see the immediate benefits that their solution brings and how moving day could be revolutionised for many home movers.”
“Clients waiting with the removal van in the afternoon for money to reach the lawyers could soon be a thing of the past.”
In addition to real estate, Shieldpay can advance multi-million-pound mergers and acquisitions (M&A) deals as well as safeguard smaller payments, such as buying or selling a car, to power classified sites and e-commerce marketplaces.
Rob Gurney, head of legal practice at premier Property Lawyers, commented: “Every link of a chain that uses Shieldpay will bring forward the time at which the top of the chain can collect their keys.”
“In a chain where all parties were using this type of solution, it would be possible for a whole chain to complete and collect keys early in the morning, reducing stress and inefficiency for all the individuals and businesses involved.”
Legal industry regulators, the CLC and the Solicitors Regulation Authority, have all expressed the market’s need for digital transformation through innovations like Shieldpay.
Stephen Ward, director of strategy and external relations, CLC, described this digital mortgage settlement in the UK as a milestone for the sector. “We are committed to working closely with Shieldpay and CLC-regulated practices to bring the opportunities and benefits of escrow and third party managed accounts to clients and conveyancers alike.”