Moody's praises Sympli, the new online conveyancing service
Moody's Investors Service says that Sympli, the joint venture between ASX Limited and InfoTrack - a wholly owned subsidiary of Australian Technology Innovators Pty Limited - will, subject to regulatory approval, provide the first seamless and fully integrated solution for online conveyancing services in Australia.
"The venture will not just rival PEXA, the current sole electronic lodgement network operator in the country, but will become the first company in Australia to replace the whole paper-based property settlement process with digital services," says Shawn Xiong, a Moody's Analyst.
Moody's explains that while PEXA currently monopolizes the last settlement stage of the conveyancing process, the InfoTrack-ASX venture will provide digital services for the entire conveyancing process.
Over the next two years, Moody's expects that the move online will mostly benefit PEXA because of its first-mover advantage.
But Sympli will benefit from InfoTrack's existing market position and relationships in the Australian conveyancing market, as well as its legal and technological capabilities, particularly its smart contract technology.
This situation, combined with ASX's significant experience and existing infrastructure in providing integrated electronic settlement services, will create a one-stop solution for industry practitioners.
"As a result, Sympli should win market share over time," Moody's concluded
The shift to electronic from paper-based settlements in the Australian conveyancing industry presented an unprecedented opportunity for digital-based property services providers such as the InfoTrack-ASX venture, adds Xiong.
Moody's analysis is contained in its recent report Property Services — Australia: InfoTrack and ASX venture to drive competition in electronic property services.
It was co-authored by Xiong with Trung Vu, a Moody's Associate Analyst.
ASX and InfoTrack announced the establishment of Sympli, a 50:50 joint venture that will provide electronic property settlement services likely starting at the end of 2018.
Moody's points out that the property services industry is fragmented, with industry players serving only parts of the conveyancing process.
Meanwhile, most state governments — including Western Australia (WA), New South Wales (NSW), South Australia and Victoria (VIC) — have committed to transitioning the property industry to a paperless environment.
And, mandates are in place in WA, NSW and VIC to push all transactions online by December 2017, July and August 2019, respectively.
Moody's says that service providers with a large reliance on traditional information brokerage and manual property settlements — such as SAI Global Holdings — will likely struggle to grow in light of the new competition.