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Fee for service debate escalates

Staff Reporter 4 minute read

Jessica Darnbrough

The fee for service debate shows no sign of abating as other industry professionals voice their opinion on the issue.

For the last two weeks, brokers and industry professionals have remained at odds over whether or not a fee for service model would help or hinder the third party distribution channel.

NAB Broker’s general manager distribution John Flavell and the FBAA’s president Peter White believe brokers should embrace a fee for service business model as it will not only improve the industry but will ultimately become the norm.

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Mr White told The Adviser that brokers would benefit from charging a fee for service as they would finally be properly remunerated for their services.

However, it seems not everyone agrees.

Yesterday, Firstpoint NB director Troy Phillips told The Adviser that implementing a fee for service went against everything the broking industry represents.

“Fee for service should not be used as a substitute income. Brokers are paid by lender commissions and they shouldn’t charge a fee just to boost their bottom line. If they are going to charge a fee they need to be transparent and clearly indicate what the fee is for,” he said.

Lenders pushing fee for service to substitute commission are simply way off the mark.”

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Fee for service debate escalates
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