Xapii Now Includes Household-Level HEM Expense Breakdown

Until now, Xapii’s serviceability API provided a combined HEM result across all households in an application and did not indicate whether the benchmark was used in servicing.

This limitation can make it time consuming for Xapii users to gain the relevant information needed for serviceability and compliance.

To speed up assessment times, we’ve improved our serviceability API to deliver household-level HEM figures, along with clear indicators showing whether they were applied in decisioning. These serviceability improvements will give customers more precise insights, helping them strengthen compliance reporting and decisioning.

Created by the Melbourne Institute of Applied Economics and Social Research, HEM sets a minimum standard for household expenses to ensure lending assessments remain consistent and responsible. When a household’s declared expenses fall below the benchmark, the HEM figure is applied in calculations.

When declared expenses are above the benchmark, HEM is not used. By surfacing this detail at a household level, customers gain the understanding they need to see exactly when HEM was applied, providing stronger reporting capability and a clearer view of servicing decisions.

How does household-level HEM work in Xapii?

We’re introducing a new ‘households’ section to the Serviceability API.

Here’s what’s included:

1. Household HEM Benchmark: This is the baseline spending benchmark set by the Household Expenditure Measure (HEM). It’s worked out using details like household income, number of dependents, and whether it’s a single or couple household.
2. Household Monthly Expenses: This is a sum of specified household’s expenses in the categories that are compared to the HEM benchmark.
3. Household All Expenses: This is the sum of all the specified household’s expenses. It includes the greater of either HEM or household monthly expenses, plus any rent, child support, or uncategorised expense categories. This is the expense figure used in serviceability calculations.
4. Is HEM Used?: This shows whether the HEM benchmark was applied.

Why household-level HEM insights matter

With the new enhancements in Xapii’s Serviceability API, Xapii users gain:

• Stronger compliance reporting: Detailed household-level expenses provides a traceable audit trail.
• Enhanced risk insight: Undisclosed living costs can be spotted at the household level, not just across the application.
• Efficiency and confidence: No more manual calculations or guesswork. Serviceability decisions are transparent and easy to support.
• Better customer conversations: Financial assessment outcomes can be explained clearly improving customer experience and ensuring consistent lending decisioning.

These improvements translate into faster, more confident decisions, with the assurance that every outcome is transparent, compliant, and responsible.