Brokers split on fintech competition

This article originally appeared on Australian Broker on 24/4/2018.

More than half of mortgage brokers are not concerned about increased competition from online broking platforms, according to a recent survey.

Despite this, almost a third of respondents said they were looking to improve the digital capabilities of their businesses.

The survey was completed by MyState Bank’s national broker network. More than 47% of brokers responded saying that in the face of increased competition from online broking platforms, they would remain focused on their existing business models, which they considered to be competitive.

A further 13% said they believed the threat of greater competition from online platforms was not significant to them.

However, not all of the broking community agreed about the impact of the current competitive environment. More than 22% of brokers surveyed said they were adopting new technology and software to remain competitive with another 5% seeking to partner with fintech companies to improve their client offerings.

The survey respondents were split when it came to the impact of mobile payment solutions such as Apple, Android and Samsung Pay on their clients’ choice of mortgage provider.

Almost 48% of brokers said mobile payment solutions were “important” to their customers and influenced their choice of mortgage provider. This was made up of 34% “somewhat important”, 10% “important”, and 4% “critically important”.

Just under 40% of respondents said their clients were “focused on the best deal they can get in terms of price and features” in relation to the mortgage itself, rather than mobile payment solutions. A further 15% said mobile payment solutions were “rarely mentioned” by customers.

MyState Limited Group executive broker distribution, Huw Bough said the results of the survey reflected the relationship-based nature of the broking industry.

He added, “Many brokers have stated that their customers still prefer face-to-face service when it comes to the largest transaction of their lives. However, a large number of brokers indicated that they are keen to explore the opportunities that new technology presents in relation to improving customer service. It looks like the debate will continue for some time yet.”