Banks may be pushing digital channels in a bid to reclaim home loan customers from brokers, but Finsure Group said the personal service brokers offer remains their strongest advantage.
Responding to a recent S&P Global Ratings report titled, Australian Banks Want Borrowers Back - And Mortgage Brokers Out of the Way, Finsure CEO Simon Bednar (pictured) said digital lending solutions, including artificial intelligence (AI), are no match for the experience and service brokers provide.
“The level of service that mortgage brokers offer their customers remains the best in the industry and is the key reason why loan originations by brokers have surged passed 76%,” Bednar said.
While acknowledging the role of technology in streamlining loan processes, Bednar said relying on it alone will not win over borrowers.
“We know that technology continues to evolve at breakneck speeds, enhancing the loan application process. However, we’ve seen time and time again that technology isn’t the silver bullet when it comes to attracting customers and lenders pursuing a tech-focused product offering are failing to gain traction,” the Finsure boss said.
“There remains a fundamental truth - the more technology develops the more customers are seeking a more personal, more genuine experience with real people. Any digital solutions designed to eliminate all human interactions will ultimately fail.”
Bednar pointed to recent research from Apple highlighting concerns over the accuracy and limits of AI, reinforcing the case for a hybrid approach.
“This research highlights how a tech-only strategy may be fundamentally flawed,” he said.
“While AI and technology will potentially enhance and augment the lending process, there will always be a role for a broker. One scenario is that some heavy lifting can be carried out by AI, allowing brokers to become more strategic with their customer relationships.”
Brokers are already using digital platforms to simplify lending - but never as a substitute for real-world engagement, Bednar said.
“The broking sector utilises the latest online platforms as tools to make the process of obtaining a loan as efficient and simple as possible, but we don't see that as a substitute for human interaction,” he said.
Finsure data showed that residential brokers settling about 100 loans annually benefit from a well-diversified lending portfolio, typically engaging with around 15 lenders.
“This balanced approach suggests that these brokers benefit from a diversified portfolio without spreading themselves too thin, enabling them to offer customers varied products while maintaining strong lender relationships,” Bednar said.
