Blend charts course for digital consumer lending expansion

Q&A with CEO Nima Ghamsari reveals strategy and roadmap for end-to-end digital lending integration with financial institution partners

Blend has had a busy year to say the least, and from my interview with co-founder and CEO Nima Ghamsari — Blend is positioning itself to continue playing offense while focusing on helping financial institutions adapt to accelerating digital consumer demands.

Ghamsari said that going forward, part of the company’s strategy is looking to expand its end-to-end product suite for all the things a consumer might need to progress their financial lives, whether it’s getting their first checking account, first credit card, first car loan, etc.

Blend has steadily grown to be a powerhouse in the mortgage tech industry, facilitating $1.4 trillion in mortgages and consumer loans in 2020. The company’s digital lending platform is used by the likes of Wells Fargo, U.S. Bank and over 285 other financial institutions, according to HousingWire. In 2020, the San Francisco-based startup significantly expanded its digital consumer lending platform.

Just last week, Ghamsari spoke at HousingWire’s Spring Summit, where he shared perspectives on where fintech is going for lenders and banks. Ghamsari said, “…being the one that’s furthest ahead and driving the outcomes, as opposed to [doing a] passive, defensive play or defensive maneuver is the name of the game. So speed is the name of the game, that’s all I focus on.” And he has the resources to focus on playing offense – In January, Blend closed on a massive $300 million Series G funding round at a valuation of $3.3 billion.

This week Ghamsari spoke with FinLedger about the company’s strategy going forward, more deeply digitizing the mortgage space and what’s ahead.

FL: I know that Blend specifically expanded its digital consumer lending platform in 2020, why did Blend make that move strategically?

Ghamsari: As we think about centering more value around the consumer, a lot of our financial institution partners – banks, credit unions or community banks – have many products to offer the consumer. One day, the consumer will be able to carry their financial lives in their pocket, and be able to do that across everything that their institution can offer them — not just what has historically been a siloed product-by-product experience.

As we think about our partners having deeper relationships with their customers we felt the need to bring all of those products together on one platform. It has two benefits. One is the technology is overlapping. A lot of the income verification, asset verification, a lot of that decisioning, a lot of the work that we have been doing for many years in mortgage is applicable to all these other product lines. But on top of that, it allows the institution to have a single view of their consumer’s financial life for the first time ever, in a way that they can apply that knowledge to multiple products at once.

FL: What is your overall strategy going into 2021?

Ghamsari: [A part of our strategy is] we’re going deep in making the mortgage process as digital and data driven as possible end-to-end. Everything from the application, to the initial disclosures, to the closing table, and all the conditions and all the things in between, we’re investing a ton in going super deep in the mortgage realm. Because there’s still a lot of work to be done there, beyond some of the things that we put in place in the last six, seven years.

The last thing is we’re integrating a lot of the providers across the end-to-end home buying and home financing journey. So, everything from your first interaction with a real estate agent, to finding your home, to making an offer, to doing the title and escrow and settlement, to moving into the new home. That home buying journey has a lot of different participants. And we’re building marketplaces to enable our lenders to have those participants deeply integrated in the mortgage process.

FL: What opportunities are you seeing going forward for Blend?

Ghamsari: A lot of the work that we’re doing is going really deep with our existing customers, making sure that you get a lot out of the platform. Because, we’re in a boom right now where there’s a lot of volume going through a lot of lenders and banks. As that boom goes on, there’s capacity issues. Then when the boom subsides, there’s going to be volume issues. There’s going to be a fight for volume, a fight for being able to serve the customer in the best way.

FL: You said that you want to go deeper into that digitizing in the mortgage space. Expand on what that means.

Ghamsari: We’re starting to look at how we automate more of the conditions that are part of the mortgage process. The mortgage process is still manual and human intensive, even with all the advances that have happened over the past decade. We’re heavily invested there, in capabilities like using artificial intelligence to extract information from one of our documents, or if we can, getting direct source data from additional sources so we don’t even need the documents in the first place. But there’s a lot of work to be done in making the mortgage process more streamlined. We’re taking this piece by piece and saying, ‘here’s the parts that we can bring to the front-end and allow the consumer to interact with in real time or allow the loan officer to do in real time with the consumer.’

This Q&A with Blend CEO Nima Ghamsari has been edited to read clearly and concisely.

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