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The head of a major mortgage aggregator says the third-party channel will increasingly come under regulatory scrutiny as its market share continues to rise.
Finsure chief executive John Kolenda says there are several threats on the horizon for the third-party channel, including greater regulatory surveillance and the threat of new online players.
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“We will see continued and heightened ASIC surveillance over both the aggregator and third-party space, particularly if the market share percentage continues to increase,” Mr Kolenda told The Adviser.
“Lender commissions will also come under scrutiny of the regulator, looking to potentially commoditise the broker service proposition,” he said, adding that this should lead to brokers looking for a greater share of wallet in cross-selling or referring other services to diversify their businesses and revenues.
Mr Kolenda said online lenders will continue to increase their market presence.
“If brokers don’t embrace internet and social media in the mortgage space, they face the possibility of being locked out of a significant segment of the market, particularly if they do not adopt a strong online presence within five years,” he said.
“Not only will lenders need to be technology-driven, but so must aggregators and brokers in order to cater for the next generation of borrowers.”
Mr Kolenda urged brokers to look to Uber as a good example of what a technology disruptor can do to an established market.
“Uber is now the largest taxi company without owning any cars. They have achieved all of this via a mobile phone app and we need to be prepared to work differently from our competitors and have our brokers future- proof themselves,” he said.
[Related: Lawyer warns against FOFA-style reforms in broking]
