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The idea of an identical industry commission rate has garnered a positive response after commissions again became a central discussion point.
Commonwealth Bank became the latest lender to increase commissions in 2014 following earlier moves from Westpac, NAB and Suncorp Bank.
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Mortgage Choice already operates a flat commission model in which upfront and trail commissions are indexed quarterly in advance, according to chief executive Michael Russell.
“Our brokers receive the same upfront and trail commissions irrespective of which lender they and the customer select,” he told The Adviser.
“Our paid-the-same philosophy allows our brokers to operate without being in any sort of perceived conflict of interest.”
FBAA chief executive Peter White said a flat commission model had merit because it would reassure the public that the broker was focused on product rather than payment.
“Even though under the NCCP today I don’t really think that happens, it does cut out the potential of that happening,” he said.
Mr White said it was realistic to think a flat commission model could be introduced across the industry since aggregators would probably support it because it would simplify their processing.
However, he warned that it might not benefit brokers because lenders might push for a flat rate beneath the average commission level of the day.
Mr White also said there would never be any incentive for lenders to make the sort of commission increases that have occurred this year.
Able Finance Services managing director Sam Crowley said he could see advantages and disadvantages in a flat commission model.
“It means we’d be perceived by the general public to not be leaning one way or the other depending on the commission,” he told The Adviser.
“For quite a few lenders, you need to be paid more to put a deal through them because it’s just so painful.
“If they all had the same processing and service levels that would be fine, but unfortunately you’ve got lenders out there that have disgraceful service and I’ve got to warn clients before I put a deal through.”
[Related: More good news on commissions may be coming]
