DIGITIZATION OF MORTGAGE APPLICATIONS: CONVENIENCE AND CHALLENGES IN THE TECHNOLOGY ERA

Abstract

Digitalization in the financial sector has brought major changes in the process of applying for Home Ownership Loans (KPR). With this transformation, prospective borrowers can now apply for a mortgage more easily, quickly, and transparently through digital platforms, without the need to visit banks or financial institutions in person. Technological innovations have made it possible for processes that used to take weeks, to be shortened to just a few days, even hours. Various advancements such as e-KYC (electronic Know Your Customer), digital signatures, artificial intelligence (AI)-based credit analysis, and the use of big data, have accelerated the process of verification, risk assessment, and mortgage approval. The presence of fintech and digital banking platforms also further expands access for people who previously had difficulties in meeting conventional administrative and verification requirements. However, even though there are many conveniences, the digitization of mortgage applications is also inseparable from various challenges. One of the main issues is the security of personal data, given that more and more sensitive data is being processed online, which increases the risk of information leakage and misuse. The threat of cybercrime such as identity theft and banking system hacking is also a problem that needs to be anticipated by the financial industry. In addition, the lack of digital literacy among prospective borrowers, especially in areas that are not yet familiar with technology-based financial services, is an obstacle in itself. In the field of regulation, the government and financial authorities need to continue to adjust policies to remain relevant to technological developments, while ensuring consumer protection in the use of digital services. Digitalization in mortgage applications brings many benefits to the financial industry and society, but it also faces challenges that must be overcome to create a more modern, inclusive, and easily accessible financial ecosystem for all levels of society. Through this discussion, it is hoped that solutions and innovations that support the acceleration of digital transformation in the mortgage sector in a safe and sustainable manner can emerge.