Brokers weigh in on new website which boasts transparency

by Julia Corderoy15 Oct 2014
After the launch of a new website which claims it will provide more transparency to the financial planning industry, Australian Broker spoke with brokers about their perception of the website and whether the broking industry might benefit from something similar.

Justin Doobov, managing director of Intelligent Finance says that although it will allow for a central “scoreboard”, he isn’t convinced it will remain entirely independent.

“I think it sounds like a good idea in theory, but I am not sure it will work in practice. I am sceptical about whether the website would be able to maintain its independence and accuracy. How can it ensure the validity and accuracy of its reviews if one broker has more time to convince clients to write good reviews on the website over another? Anyone can get favourable reports, but it might come down to which brokers have more time to tell clients to post positive reviews. 

“The website for financial planners is free for consumers and advisers to post information, but in the future if it starts bringing advertising in to generate more revenue, then that could also muddy the waters in regards to its independence.”

Word of mouth reviews are far more important and valid than internet reviews, says Doobov.

“The most reliable reviews will always come through word of mouth anyway. The reviews on the website may mainly be negative, as people who take the time to review something online generally haven’t had a good experience. If they have had a good experience, then they will probably be more likely to refer friends by word of mouth. It’s harder to verify authentic reviews online.”

Melissa Gielnik, director of Smart Lending says the industry may benefit from one central, regulated review site for consumers.

“The internet already provides a limitless playground where consumers can interact and post reviews – you only have to look as far as social networking. So, it may not be a bad idea to have one central place that is governed where consumers can find information about brokers.”

However, Gielnik also raised concerns about the validity and accuracy of the site.

“I’m concerned it may just draw on negativity. Online reviews tend to just capture people at polar ends of the spectrum; it might not give a cross-section of opinions from all the people in between – which are most of our clients.”

Gielnik also says that the MFAA already has a database of qualified credit advisers, so a similar website may struggle to find its feet in the broking industry.

“The MFAA already has a credit adviser database where consumers can search for MFAA qualified credit advisers in their area. When an adviser is a part of this database, it means they are already reputable credit advisers being members of the MFAA. This website has already grown organically by 46% last month and they haven’t even started advertising it yet,” she told Australian Broker