Report discusses biggest broker disruptors

As part of a new report released, a roundtable looked at what was disrupting the broker market

Report discusses biggest broker disruptors


By Rebecca Pike

Lenders and broker groups discussing the mortgage market in 2018 have said they believe the biggest disruptors of the broker market will be customers moving away from face to face service and significant remuneration model changes.

The discussion took place as part of a roundtable for Deloitte’s Australian Mortgage Report 2018.

It included representatives from HSBC, Liberty Financial, Police Bank, Bank of Queensland (BOQ), Westpac, ING, Suncorp, CoreLogic and Smartline, as well as Deloitte.

The group were also asked in what areas they thought broker distribution improvements would be focused this year.

The respondents were allowed to select two options. The highest answer with 45% was enhanced monitoring and compliance of broker activities.

This was followed by 35% saying it would be focused on the Australian Securities and Investments Commission (ASIC) findings regarding volume bonus related payments and incentives.

Discussing disruption to the market, with customers moving away from face to face service Joe Sirriani from Smartline said, “I think it is a generational thing. The younger generation is more comfortable with online and they will dominate more in five years’ time.”

Nathan McMullen from Westpac Group, said, “There is a lot of focus within our organisation on customer preferences for traditional face-to-face significantly reducing (30%). Recognising that, we need to adapt in order to reflect that reduction.

“The reality is when we talk about quality growth in our business, historically there was a channel composition element to that. Today those conversations are happening a lot less.

“Many customers that apply through the broker channel have an existing relationship with the bank already, so that’s their channel preference around how they come to us. We respect that choice and will continue to service it.”

Melanie Evans from ING said, “I chose to think about the quality of an external channel versus a proprietary. I think what is good for everyone is to stop viewing the situation from a bank balance sheet/ROI perspective, and start thinking about why a customer chooses to use a broker versus directly engaging with their main bank.

“If we consider the decision from the customer back, rather than looking at the process as pure return on investment or equity, a better perspective can be gained.”



Keep up with the latest news and events

Join our mailing list, it’s free!