Brokers have a great opportunity to unlock their potential through commercial and asset finance, argues FAST CEO Brendan Wright.
Residential loans have long been seen as the core service offering of broker businesses, but as the market continues to change, commercial and asset finance services are set to become increasingly important.
According to the ABS, small to medium enterprises (SMEs) – those employing fewer than 200 people – make up 99% of all business in Australia. SMEs employ a sizeable 65% of Australian workers, or around 2.8 million people. Taking these figures into account, it makes sense that a large proportion of a broker’s existing residential customer base are also involved in running an SME. After all, business owners live and invest in houses too.
Extending credit advice and services to businesses presents a huge opportunity for brokers to add value to the customer experience. The same aspects of the broker offering that residential customers are increasingly seeking out – quality advice, personalised service, and specialist product knowledge – are also factors that business owners are finding it difficult to access in an online world.
Integrating commercial and asset finance into your business
It can often be daunting for brokers to think about expanding their business model into commercial lending, as they may not be confident about providing such specialist knowledge in an unfamiliar field. This is where a gradual approach to integration can help – for instance, implementing a referral model in your business with a more experienced commercial or asset finance specialist.
FAST’s asset finance service, for example, which is regularly used by some of our top-performing residential brokers, works with a market-leading asset finance specialist. We’ve received great feedback on the service from both brokers and clients, and importantly, clients are always protected.
Down the track, once you’re more comfortable with the products and processes involved in commercial and asset finance, you can look to bring these services in-house. It’s important your aggregator is equipped to support you through the process – if you have access to a good BDM, they can be a key resource for product support, training and strategic planning.
And of course, you will also need access to a good variety of commercial and asset finance products on your lending panel in order to meet your client’s unique needs.
Becoming a one-stop shop for businesses
When offering commercial and asset finance solutions, it’s also important to consider the whole picture. Brokers can add more value for business owners by anticipating their other finance needs, such as protecting and growing their existing capital.
Look at the options your aggregator provides in helping you introduce these other services into your business. For instance, FAST Partner Planner is a referral model that links brokers with qualified financial planners.
Whichever way you approach it, providing advice and a holistic offering to business clients is going to become a key facet of success in our industry over the next few years. It’s critical that brokers identify existing opportunities within their customer base, look at ways to integrate this channel into their practice, and start having the conversation with clients about their business needs.