Mike Cagney was on a recent podcast and illustrated how blockchain will affect the mortgage originator / servicer they purchased (Homebridge). The whole blockchain thing is still a bit confusing so real use cases help me understand it a bit better.
He outlined how today, a mortgage servicer receives a high volume of ACH transfers regularly, which they can’t clearly identify where they came from. I’m not sure why that is the case. He also outlined that they have to reverse ACH payments / clawbacks regularly as well. Net net, he said that the mess of payments requires substantial administration headcount to sort the mess regularly.
What Figure is or will do is load everyone onto and have them remit payments via Figure Pay. The payments will go over the Provenance blockchain rails without involving the ACH process, will be clearly identifiable, and there would be no need for clawbacks. I still don’t clearly understand the exact details of it but his overall conclusion is that the overhead needed today will not be needed in the future state. He indicated that getting people to use Figure Pay could be incentivized with bonuses that come from the savings of lower overhead.
To that end, I am looking forward to getting a better understanding of what the timeline is for both uptake of this payment mechanism and origination / securitization of future loans on Provenance’s blockchain.