The Digital Transformation of Conveyancing
The pandemic brought a revolutionary shift in the adoption of new practices to support working from home. While the conveyancing industry, like others, rapidly embraced digital technology solutions to enable remote work, many of those solutions also helped the industry cope with increased transaction volumes due to the Stamp Duty Holiday.
Ben Carroll, Managing Director at Enact Conveyancing, explores how a more holistic approach to the integration of technology solutions, and the establishment of clear industry standards, will help conveyancers improve their processes in the long term.
COVID-19 and the future
Published just before the pandemic hit globally, the CLC’s Discussion Paper on the future of conveyancing examined how the industry could evolve over the next 10 years and, specifically, how conveyancing could be a fully electronic process by 2030. Interestingly, the industry’s efforts to adapt to COVID-19 made some of the concepts in the CLC paper a reality sooner than expected.
There is for example the encouraging progress of conveyancers’ adoption of electronic signatures in some instances. However, the critically important implementation of best practices for a more digitalised conveyancing process still lags.
There are some technologies already available to help conveyancers improve processes. Biometric ID, as well as online TA6 and TA7 forms, for example, can substantially shorten the time it takes to onboard new clients. However, the adoption of these types of technologies varies wildly among firms.
Some of this can be explained by the fact that key stakeholders in the process have been slow to formally “green light” new technologies. The UK Finance Handbook, for example, which governs what conveyancers must do when working with lenders, has not yet been updated to fully endorse biometric ID as an acceptable, or potentially even a preferred, means to verify identity.
The lack of an accepted standard for biometric ID verification partially explains the reluctance of conveyancers to embrace advances in this area. Without an industry standard, conveyancers have no means of verifying whether, ultimately, they were underwriting the biometric ID risk in the event of a claim, leading to uncertainty among conveyancers and slowing the adoption of ID verification technology.
Thankfully, HMLR recognised the potential benefit of robust biometric ID checks in fraud protection and acknowledged that conveyancers and lending institutions need greater clarity and certainty prior to biometric ID checks being universally adopted across the industry.
The resultant Safe Harbour Standard that, once launched, digital ID providers will have to achieve to be compliant, has raised the minimum standards bar. However, from a practical perspective, challenges remain. The Safe Harbour Standard can currently only be achieved through a digital ID check on a micro-chipped passport, so it could be some years before a significant majority of customers have the documentation necessary to meet the standard.
The Safe Harbour Standard, when enacted, should provide greater clarity to conveyancers regarding their duty of care in relation to identity verification.
What are our weaknesses?
The lack of access to digital information continues to hamper the conveyancing process. If our industry’s goal is to streamline and reduce transaction times to enhance our customers’ experience, then all data required for a transaction must be available digitally and on demand.
This includes local search information, full planning and building control histories, NHBC documentation, landlord and management company information packs, and more. In recent years, there has been a significant shift in the amount of information available online, but more progress is needed.
Making changes mandatory
What needs to be considered is whether certain digital processes enhance the conveyancing experience so positively that they effectively become a requirement. But today, some firms believe that including ‘a digital signature here’ or ‘a biometric ID check there’ doesn’t go far enough, reducing the incentive to invest in the process change. Without an industry standard, conveyancing firms are left to decide whether certain technology investments are truly worth the cost.
There is growing customer demand to make what has traditionally been a somewhat stressful process smoother for our customers. Clear industry standards will play a key role in allowing firms to determine which technology investments will help achieve that.
While some firms may resist change, the pandemic has taught us that a more digitalised approach is possible.
Allowing staff to work from home has been a huge paradigm shift for the industry and proves that systematic change can happen.
As e-conveyancing practices grow, and industry standards are put in place, the adoption of new technology solutions will become commonplace.