In the context of business and management, organisational change is an area that attracts much study and commentary. However, when an industry starts to change around the professionals who define and drive its success, the pressure intensifies.
Noting the turbulence that has faced the broker channel of late, in February National Australia Bank launched the ‘Bank Behind the Broker’ campaign to help brokers tackle change, while providing a suite of new tools to navigate a working environment that has been reshaped by multiple factors over recent months.
“We fully support the broker channel,” says the bank’s GM of broker distribution, Steve Kane.
“NAB’s ‘Bank Behind the Broker’ message is saying we recognise how brokers contribute to good customer outcomes, and we will continue to support that.”
There is sincerity in the slogan: not only has NAB rolled out a whole series of tools and service enhancements, but the third party channel even got a mention in the bank’s latest financial results, which credited brokers with driving growth across housing loans and consumer banking, in both year-on-year and half-year figures.
“It’s fair to say the growth in our portfolio is very strongly supported by the broker channel,” Kane says. When it comes to broker-originated loans, the third party channel delivered around 46% of all mortgages in the first half of FY19 and 14.3% of all of NAB’s business loans – a figure supported by the 2018 launch of QuickBiz for Broker and the extension of ApplyOnline for SME loans.
While its performance is strong, Kane reveals that the bank is far from resting on its laurels, and that to 2020 there will be product and related education developments across small business lending, commercial lending and residential mortgages.
These are intended to drive efficiency while providing quicker working processes for brokers and better outcomes for their customers, as proven during internal modelling.
“The only thing that has been consistent for brokers is change, and that puts a stress on everyone. At NAB, we make sure we are always focused on delivering the education around change in a consistent way. Every decision we make internally we consider how it will impact the broker and the broker’s customer,” Kane says.
Technology will be a central focus, not only in cutting down application and turnaround times but in identifying crossover opportunities between residential and business clients by leveraging NextGen.Net’s ApplyOnline.
Additionally, DocuSign capability will be expanded, giving NAB the means to fully digitise applications from step one through to settlement, including documentation. The bank has also moved into the mandatory documentation space, creating efficiencies across the board.
“That is driving better customer turnaround, quicker response for brokers to go back to their customers, less rework in relation to applications, less requests for information – it’s a win-win for everyone,” says Kane.
To help brokers keep up, Bank Behind the Broker is supported by an education series combining webinars, digital PD days and face-to-face learning to safeguard and drive standards, with curriculums devised in collaboration with brokers, aggregators and industry players.
For example, in actively prepping brokers for upcoming changes to ApplyOnline, NAB invited NextGen.Net to deliver education sessions, during which brokers heard about the latest service, policy and product updates from eSign and ApplyOnline, including the new Compliance tab and supporting document requirements.
“A continuous focus on education and training improves professionalism and drives increased customer satisfaction and market share, so our focus will continue in this area,” says Kane.
This year has also seen an extension of the Digital PD Day that debuted in 2018. Held in May, the latest session saw more than 2,000 unique users log in and, building on 2018 as well as new and emerging developments, the agenda covered business lending opportunities, economic and property market trends, and navigating regulatory change.
“The digitisation of processes improves efficiency for the broker and their customer. They have the capability now to ensure that everything is provided upfront, and we are seeing a significant lift already in application quality, which is fantastic,” says Kane, who reports that accurate, high-quality applications can receive an unconditional answer “well inside” 48 hours.
In the consumer space NAB has introduced a series of offers to maintain its competitive edge, including cashback on purchases and refinances. Combined, these measures had a positive impact on NAB’s April 2019 NPS scores and broker surveys (see box), during which it emerged that 56% of commercial and small business brokers and 38% of residential brokers are likely to recommend an NAB loan to their customers.
Deloitte Access Economics calculates that the mortgage broking industry contributed $2.9bn to the Australian economy in 2016–17, supporting the employment of more than 27,100 full-time workers, as well as the lending needs of thousands of home and business owners. As a testament to this, broker market share reached a new high of 59.7% in June of this year.
Recognising that the impact of this reach extends well beyond metro areas, NAB is also helping brokers extend their services to the wider community, while diversifying their own business models.
For example, the bank provides its brokers with access to specialists across a broad range of industries, including health, aged care and agriculture, in order to handle different types of customers with specific needs through dedicated resources.
“We are genuine in our belief that the services provided by brokers to the Australian community are absolutely essential, particularly in a market that has seen significant changes. That is why we are the bank behind the broker, because we feel brokers are an absolutely vital contribution to the financial services industry,” says Kane.
“It is our role to be supportive of that, and to supply information and data to keep everyone abreast of all the changes that they are going through.”
This means brokers, too, will become teachers, educating their clients on the customer-facing changes that banking and finance must navigate over the coming months. Among these are open banking, CCR, the replacement of the HEM benchmark, changes from the Combined Industry Forum, and the new Banking Code of Practice.
“Brokers play a primary role in the relationship with the customer. It is important that brokers in their discussions with customers have the right support and information to keep the customer fully informed,” says Kane.
Tying these various threads together, Kane says the focus for brokers over the coming year boils down to one point: relationships over transactions. It’s an approach that will generate sustainable business streams while continuing to meet the best interest of each and every customer – something that itself will become a focal point in the development of new regulatory frameworks over the coming months.
“We see a very positive outlook for mortgage and finance brokers. We think their value proposition and the value they have shown to the customer is integral to future longevity of the industry,” Kane says.