A leading aggregation head claims that consolidation in mortgage broking will likely pave the way for boutique aggregators to emerge in the future.
Connective principal Mark Haron told Australian Broker boutique aggregators faced the challenge of either scaling up and becoming bigger, or staying within a smaller boutique environment.
However, he said consolidation - which has seen the likes of National Mortgage Brokers being scooped up by Aussie, and banks such as NAB and CBA taking stakes or owning broker groups - is likely to follow a similar trajectory as that experienced by financial planners.
"I know that is a bit of an old cliché, but there are reasons things play out like that," Haron said.
"There definitely was a significant level of consolidation in the planning industry to the point where nearly every major dealer group is owned by a product manufacturer," he said.
"I don't think that will happen to that extent within our industry, though it will happen a fair bit in terms of the major aggregators," he said.
Haron said just like with the introduction of Australian Financial Services Licenses (AFSL), over time financial planning operators saw it was actually not that hard to own and operate an AFSL.
"We started to see a lot more boutique financial planning dealer groups come back into the space, and even more are starting to pop up now," Haron said.
"I think we will still see a number of boutique aggregators pop up for the right reasons, and they'll have a certain way they will do things which will vary and make them different from major aggregators."
However, Haron said any new operators would need to provide a clear value proposition to succeed - rather than just being in it for the money.
"If you are just doing it to make money then generally people will see through that it is not going to work," he said.
"It is important to make money, but you also have to have a strong value proposition that appeals to brokers and that is something that continues to be a challenge for us at Connective - we have to keep ensuring that we add more and more to our business."