The aggregator has warned brokers that relying on narrow revenue streams has become increasingly risky as interest rates climb.
Finsure has called on its network across Australia and New Zealand to rethink singular, mortgage‑only models after Tuesday’s interest rate increase took the official cash rate to 4.10 per cent, extending a tightening cycle aimed at cooling stubbornly high inflation.
The group said that rising repayments, weaker borrowing capacity, and higher living costs driven in part by the ongoing military conflict in the Middle East, had amplified the need for a more diversified approach to lending and advice.
Bednar warns of ‘challenging times’
Simon Bednar, CEO of Finsure, said the combination of consecutive interest rate hikes and market volatility had created a difficult environment for borrowers and intermediaries alike.
“We are all facing challenging times with interest rate increases and market fluctuations outside of our control,” he said.
He said that the surge in fuel prices flowing from the latest geopolitical shock was a key factor behind his push for diversification.
Bednar noted that the aim of the message was to help businesses respond to forces they could not influence but could strategically prepare for.
“It’s important for brokers to be prepared to diversify their service offering and revenue streams in response to these events,” Bednar said.
Finsure urges brokers to broaden revenue scope
Bednar said Finsure had been using its professional development program to encourage a shift towards varied income streams and more comprehensive client support.
“I have been urging brokers attending Finsure professional development days around Australia and in New Zealand to address their service offerings and revenue streams,” he said.
He said that developing additional revenue lines was central to cushioning the impact of higher interest rates and other external shocks on businesses.
“This will enable brokers to offset the negative impact of rate rises and better protect their businesses from unpredictable outside forces,” Bednar outlined.
He added that the current period of stress was accelerating an industry shift that had been underway for several years, as an increasingly large share of brokers move into commercial, asset, and other specialist finance segments.
“Our industry is increasingly moving towards a more professional approach, which helps develop more loyal clients during difficult times,” he said.
The central bank lifted the cash rate by 25 basis points to 4.1 per cent on Tuesday (17 March), marking its second consecutive hike and reinforcing expectations that the rate cycle may have shifted back toward tightening.
All four major banks have confirmed they will pass on the full 0.25 per cent increase, but their timelines vary, with Commonwealth Bank of Australia (CBA), National Australia Bank (NAB), and Australia New Zealand Banking Group (ANZ) implementing the change on 27 March, while Westpac will follow slightly later on 31 March.
[Related: Bullock defends rate hike, insists demand drove call]
