High street giants including Legal & General, Abbey National and the Woolwich have developed an XML-based standard to enable financial advisers linked to an extranet to offer an acceptance in principle for mortgages within minutes. Under the old system mortgage applications could take up to 24 hours to get an acceptance.
Bob Gearing, change programme director for Legal & General, said, "Major cost savings will come from lenders making savings in their business processes. We are looking for them to share the savings with us and our intermediaries."
L&G is also keen to apply the XML data-sharing standard for its other financial services, including stakeholder pensions, he added.
Analysts said the initiative was a step forward but warned that it could pose challenges to IT departments.
"It sounds interesting and a great help to customers and financial advisers," said Duncan Brown, consultancy manager at IT analyst Ovum. "But the success of the new system would rely on IT departments maintaining up-to-date and consistent financial information across all their Web sites."