When the internet was introduced, the “worldwide web” had the potential to be used as a tool to democratize access to information. In the 1990s, there was Web 1.0, which presented its share of navigational challenges, making the process disorganized and daunting.
Web 2.0 was next. With it, social media platforms like Google, Facebook and Twitter came along, which streamlined connecting and making online transactions. Many critics complained about the monopolization of the internet as moguls such as Zuckerberg accumulated power in the style of the old-fashioned robber barons like J.P. Morgan.
Web 3.0 is the latest technology that allows the public to take back some of the power and restore the early promise of a democratized internet, eliminating the big intermediaries of the internet. Web 3.0 utilizes artificial intelligence, machine learning, and blockchain to achieve communication where individuals not only own their data but will be compensated for their time spent on the web.
If this sounds confusing, then you’re not alone. We have expert Yatin Karnik to help break it down for us. Karnik is the founder and CEO of Confer, Inc., a company that has introduced an innovative mortgage platform powered by blockchain technology. Through this technology, customers and clients can seamlessly access the best mortgage rates.
MISMO is the Language of Lending
The Mortgage Industry Standards Maintenance Organization (MISMO) is a non-profit responsible for developing standards for exchanging information and conducting business in the U.S. mortgage industry.
“Through broad industry collaboration,” explained Karnik, “MISMO creates standards that support solutions to the industry’s toughest business issues, reduce costs, and improve transparency and communications in housing finance.”
MISMO introduced Innovation Investment Fee in February 2021 to support work to foster innovation and efficiency in the digital mortgage process. Over 1,500 lenders have paid the innovation fees.
“MISMO Claims they are ‘Creating the Digital Future for the Mortgage Industry,’ but the only way to participate and contribute to the future of the Mortgage Industry is through paying an Innovation Investment Fee,” said Karnik.
Membership to MISMO is open to anyone, from mortgage lenders, banks, credit unions, government agencies, and more. However, the MISMO platform is a Member benefit, requiring a fee.
Web 3.0, Meet MISMO
With Web 3.0 and the democratization of finance knocking on our doorsteps, it is anticipated that the public will not sit idly by and pay these fees.
“How is it acceptable to tax innovation and allow democratic backsliding, which can also be referred to as autocratization in this case?” asked Karnik.
What MISMO has achieved thus far in the past 22 years is remarkable, forming a broad industry consortium of lenders and third-party providers to create a standard language of communication. But in 2022, it is time to think differently.
“We need to truly democratize lending by starting to democratize the Language of Lending,” explained Karnik. “And we democratize the Language of Lending by making it accessible to everyone without any barrier of entry; not by taxing the language, which stifles innovation.”
In Karnik’s attempt to begin democratizing lending, he has proposed a new language. “It’s a technically superior language that doesn’t tax innovation. It is open and accessible to all with zero entry barriers to come and take the concept further to new highs.”
Karnik suggests a protocol, a mode of communication between lenders and third-party providers — all current users of MISMO — that can be implemented in a more timely and cost-effective manner.
“This protocol uses JSON instead of XML,” said Karnik. “The benefit of using JSON for communication is that communication between parties is componentized, ensuring backward compatibility. Hence, innovation is made faster and easier because anyone can take an extension forward and build on it with confidence that the change has been componentized and won’t break the past working communication.”
“We at Confer Inc. are creating a language of lending that is open and accessible to all, owned by none, that will spur the industry’s growth by encouraging innovation that is encouraged by keeping it open source using the latest technologies like JSON.”
JSON, in recent times, has established itself as the de-facto standard for data interchange in services architecture.
“We need to ask questions like, does it take that long to provide a JSON version of MISMO? Does it require an innovation fee to use the JSON version of MISMO?”
While XML is predominantly used in SOAP-based architecture, for REST architecture, JSON is the preferred approach:
- JSON is lightweight and consumes much less memory footprint print compared to XML
- Serializing and de-serializing JSON objects is much easy and faster than XML
- Retrieving values programmatically is relatively easy as the notation is more in sync with object notation
Innovation should not be something someone needs to qualify for or requires a membership. Using JSON with the reference model MISMO has built will help propel the industry’s innovation and also allow new entrants with a more timely and cost-effective manner to communicate with the rest of the mortgage industry.
“We at Confer Inc. have built a proof of concept for the next-generation communication protocol that all participants in the lending industry can use, and it’s just the beginning. We need visionaries, technologists, and industry experts to unleash their creativity and take innovation to the next level, especially with Web3.0 knocking on our door. It is not a choice but an imperative that we democratize finance.”