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SMSF Round Table

Brokers are constantly hearing that SMSFs are the next big thing, but do they need any special training or upskilling to get involved in this growing industry? A panel of industry experts offer Australian Broker their insights.

Video transcript below:

Reporter:  Brokers are increasingly told that Self Managed Super Funds are the next big thing.  But what kind of special training or upskilling would they require to get involved in this growing industry?

Adam Smith, Editor, Australian Broker
Adam Smith:
 Where do I start?  What’s my jumping off point as a broker to upskill myself, to prepare myself to get into this area and who is going to help me do it?

Tanya Sale, Outsource Financial
Tanya Sale:
 Well dear, I think it [definitely] comes down to the [ATOs], the banks, I really feel strongly 

Male speaker:   I believe that banks are playing a key role in terms of education,

Tanya Sale:  on this.  They have to play a clear role in training and education.  Again because SMSF lending is not a normal transaction.  So you just can’t

Male Speaker:  Yeah, issue that a separate accreditation.

Tanya Sale:  It has to

Male speaker:  Oh yeah, not just I am broker, [lend you right SMSF funds]

Tanya Sale:  Some of them have, you may, you have to get commercial accreditation minimum, because you have to understand the complexity of, like a commercial transaction.  This SMSF is not a residential transaction and if everyone thinks that it is, truly they are kidding themselves, they really are.  It has to come down to the banks to put things in place, training and education to separate.  You already have residential accreditation, you already have commercial accreditation, you must have SMSF accreditation.  

Adam Smith:  So I guess from a lender’s perspective, how are you communicating this opportunity to brokers and how are you then upskilling them to be prepared for it.  I mean is, it could be a bit of a tough sale to say, here is this great opportunity, but you need all this extra skill set to get involved with it.  How do you communicate that and make it attractive to them?

Sinclair Taylor, Westpac
Sinclair Taylor:
 Look I think a key component of course is getting the education offer right.  So we have spent a lot of time through our broker [routers] in particular educating the existing crop of brokers as to what the opportunity is, where is the right jumping off point and getting yourself educated first and foremost before you can contemplate the loan is the right starting point.  So we run regular training sessions with our broker BDMs, with our local business bankers in particular to upskill the broker community on what are the mechanics of the transaction.  It’s absolutely right, this is more complex than residential lending and there does need to be an overlay of a bit more seriousness and sophistication from the broker community and obviously commitment from us as an organisation to make sure that we have got the right brokers referring the right deals into this.

Tony MacRae, Westpac
Tony MacRae:
 Over the last 12 to 18 months, we have provided education sessions for over a 1,000 brokers nationally.  But the other piece that we do to try and help being the specialised nature of it, we have purpose specific accredited group of local business bankers that have located in our branches that work very closely with the brokers to transact the SMSF loan.  

Justine Tills, Outsource Financial
Justin Tills:
 Can I add from that.  As you well know ASIC, there is always updates what’s happening and [along with the office data revenue] there’s been quite a few changes to the Duties Act over September.  I think there should then be ongoing training, maybe quarterly or every six months from the lenders perspective

Sinclair Taylor:  I have the observation that self managed superannuation involves, sorry superannuation system colliding with the Australian tax system and they are very complex pieces of legislation with a lot of tinkering and there is lot of updates, so brokers need to [of course], we do need to have broker involvement.

Tanya Sale:  [And true] we have to be really careful in this sector, in this space, we really really do, because ASIC are watching it closely and not only ASIC, even the ATO is all over this like a rash and this is where the danger is, you know you get a product, you have a great product and you get out there, it shouldn’t be, it shouldn’t just be open [slatter], it shouldn’t be off offer, it shouldn’t be on offer to every man and their dog in the broking move, it really shouldn’t.  It is a specialised arena and there should be specialists that are only accredited to sell that.

Adam Smith:  Well it’s a very complex issue and one that I am sure we won’t exhaust in any round table.  But hopefully we have been able to clear up some misconceptions and present the opportunity in a way that brokers may be able to give this sector another look.  Thank you everyone for participating.

All:  Thank you Adam, thank you, thank you.