How aggregators help you diversify and grow

During our live-streamed Aggregator roundtable discussion, MPA heard from leading aggregators how they helped brokers diversify and grow their brokerages.

Diversification may be second only to thought leadership in terms of buzzword of choice for broker associations and lenders, but in fact aggregators play the biggest role in helping brokers actually introduce new types of lending. Diversification can be a costly and timeconsuming business, and we wanted to know what our aggregators were doing in practical terms to help brokers make the switch.

FAST has long been a home for strong commercial brokers, as well as a number of residential brokers. Indeed Wright insisted that diversification worked in both directions: “There is significant opportunity for traditional mortgage brokers to do commercial lending, but let me be clear that commercial and asset finance brokers more and more are doing home loans as well.”

FAST runs summits on commercial and asset finance lending, Wright said, and is launching an asset finance white label product.

However, the biggest step forward, our panel explained, had been in application software. Lenders were investing heavily in allowing smaller commercial transactions to go through standard application software, Wright observed. Difficulty applying was holding many brokers back, according to My Local Broker chief Smith. “They’ve always wanted to get into that space, but there’s been a lot of manual processes for getting into that space and CRMs haven’t traditionally supported that functionality as best they could,” she said. In response they were building this functionality into their software, Smith added.

According to the aggregators on our panel, diversification also depends on partnerships. In June, Vow partnered with commercial comparison site Valiant Finance to offer brokers around 34 additional niche lenders, which Vow would not have been able to deal with through its own platform, Brown explained. At Outsource, partnering was a response to members’ demands for a general insurance offering. “We partnered up with Allianz and that’s been brilliant for us … what that allows us is to branch into other things,” Sale said.

Those “other things” included reverse mortgages, Sale explained, recalling earlier points made by Wright and Brown that financial planning, wealth and risk should be on brokers’ radar. In terms of more immediate prospects, Moore advised brokers to look at small commercial and asset finance deals for SMEs, an area he believed would grow for more than five years, while he emphasised that “it depends on where you’re at with your business, and coming up with the right model to suit your business”.

“Let me be clear that commercial and asset finance brokers more and more are doing home loans as well” Brendan Wright, FAST

What do you do on an individual level to help your brokers grow their businesses?
Between technology and regulatory pressure, learning and development has been transformed in recent years. On the surface, this has meant more is available to brokers – webinars on ASIC’s review; PD days, commercial summits – but many brokers claim the individual attention and advice they once received has been forgotten, a belief that challenger aggregators have capitalised upon.

Outsource Financial make much of the fact that all their new brokers will meet face-toface with Tanya Sale. “This whole industry is based on relationships, and the only way to get a really strong relationship is when you’re face-to-face and eyeball someone,” Sale explains. “I believe that they should get to know me; I’m the one driving the company, and if they don’t like what I’m saying or how I’m presenting the company to them then they might not be a fit for us.”

Productive conversations between brokers and partnership managers are important at FAST, Wright said: “These are strategic business-to-business conversations, not how much you’re going to sell next week.” FAST put a lot of effort into hiring, he explained, to find effective and diverse PMs who could actually reflect the diversity of FAST’s membership.

Not everyone on the panel saw a conflict between face-to-face interaction and bigger events. As Choice boss Moore put it, “It’s not an either-or”.

“What we do know – and this is well documented in learning as well – is that it’s far better to learn from someone who’s experienced than just to learn theory,” Moore said. “At Choice we match up individuals at a local level and then bring in an expert.” The expert was often a broker who had experienced the topic being discussed, adding to the peerto-peer learning environment.

Similarly, at Vow the most popular events were their compliance workshops, according to Brown. “It really is an open-risk environment where they bring deals in and talk openly to the group over how they can become compliant and stay compliant moving forward.” This was accompanied by audits to identify where training was most needed, Brown added.

My Local Broker brought a slightly different approach to the debate, one centred around technology. Its BDMs identified brokers’ individual needs and then fed these back to software developers, Smith explained, who then customised the IT systems to suit the individuals. “Technology is great but there’s also a very big sense of individualising the technology as well,” she said.

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