Blockchain Digital Government – Digital Mortgages

In this video

I’ve started an article series ‘Blockchain Digital Government’, to identify the enabling role the Blockchain will play in building new digital government services.

Identity-Enabled Digital Services

What’s immediately notable is the involvement of Identity technologies too, the two are practically inseparable.

For example this enabling role of new digital service innovations is effectively highlighted in the UK Government’s HM Land Registry digital business plan, in which they describe a future intention of:

“We will continue to enhance and expand our existing e-enabled services, such as our innovative Digital Mortgage service that uses secure identity assurance techniques to enable a customer to sign their mortgage deed digitally. Across all stages of digital service development, the needs of the user and a drive for speed and simplicity will be at the heart of our design.

  • we will launch a Developer service to provide a digital online lodgement and approval of estate plans and template leases and transfers.
  • we will launch a Digital Transfer service to create, sign and register a transfer of a registered title.”

Business Secretary Greg Clark believes these Digital Mortgages could help reduce fraud.

The role of Identity highlights services / organizations such as Gov.UK Verify. For example in this PropertySolvers article the author explores the scenario, in particular noting the HM Land Registry ambitions:

“Graham Farrant, chief executive and chief land registrar at the HMLR reported on testing the Sign Your Mortgage Deed service for remortgaging homeowners.

The mortgage deed will be produced and signed as part of a largely disintermediated digital conveyance process legitimately recorded at the Land Registry. Identity assurance will be provided by the GOV.UK Verify service.”

This is especially notable because it is a significant technological leap, to accept Identity-related authorizations from a third-party rather than directly yourself, and this concept is currently experiencing teething issues, with Verify receiving considerable negative press for adoption and user abandonment issues.

For example the Law Gazette writes specifically on this relevant to this evolution of e-conveyancing, highlighting the basic evolution to online service is essential but the choice of Verify adds an element of doubt.

Blockchain Digital Identity

In this digital strategy plan HM Land Registry also states a goal of becoming a world pioneer in the use of Blockchain technologies, and so we can start to examine its potential application by asking how it might augment this Digital Mortgage scenario.

First we can take a step back and consider the general trend of Blockchain and Identity integration. A highly recommended primer overview is this presentation from Andre Boysen of SecureKey:

Blockchain Registries

Given the Blockchain is fundamentally a registry system then naturally the field of Land Registries is a very fertile area for its application.

As Anglia Research describes it is specifically intended as a ledger system for enabling and recording asset transfers, and CoinDesk provides this detailed examination of the use case, highlighting how one aspect of natural disasters is the potential loss of all paper based versions of these records, avoidable through encoding them on the Blockchain.

A number of countries are already blazing a trail in this area, including the UK, Sweden and Georgia each trialling implementations at different stages; it’s estimated the Swedish adoption could save taxpayers €100m. Chromaway, the supplier behind the Georgian system, discuss the scenario in more technical detail through this presentation, and this paper ‘A blockchain­ based property ownership recording system‘.

Registers of Scotland recently held an ‘innovation month’ to introduce and brainstorm the potential.

Use cases such as for Alvie & Dalraddy Estates the highlight the practical challenges are more to do with ‘legacy input’, how to convert all the paper-based records.

Lastly the really big dimension is the commercial potential presented through a ‘GaaP’ – Government as a Platform approach. At its core this means opening up government systems to external, commercial and public developers via APIs and Open Data.

This then enables new commercial services to utilize those services and data; for example Scottish proptech firm, Lettingweb, has launched its Letting Professionals Model Tenancy (LPMT) with legally binding digital signatures.

Core features, like Blockchain/ID signing services, extended through the supply chain for partners to then build into their apps, is an implementation of the ‘Platform Business Model’, and represents the fundamental principle of digital business model transformation.

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