Former Aussie Home Loans CEO Stephen Porges has told The Adviser why brokers are perfectly positioned to capitalise on the personal lending space.
Mr Porges, now the executive chairman of marketplace lender DirectMoney, says the ASX-listed company's new strategic partnerships with Loan Market and Finsure will provide brokers with an effective client retention tool.
“It’s always been a bit hard for brokers to diversify into this space, but we’re making it really simple and we have a channel dedicated to the broker community,” he said.
“I think we have a unique insight to the industry, and we’ve developed our model specifically for it.
“A personal loan generally lasts for only three or four years, so it can be used by brokers as an effective client retention tool for home loan customers.”
Mr Porges said the opportunity for brokers to grow their business through personal lending is “very significant”.
“The broker who does not service their clients for more than just an individual product leaves those clients likely to be stolen by a bank or another competitor,” he said.
“From my experience at Aussie, we found that the more products you had with a customer, the more likely you would have a long-term relationship with that customer.
“The broker channel is very professional, and brokers should have the ability to service customers on a broader range of financial needs – not just the mortgage.”
The new partnerships give Loan Market and Finsure access to its technology-based lending platforms and a dedicated team to assist them and their brokers further service their customers, Mr Porges said.
“Aussie played a large part in changing Australia’s mortgage lending landscape. At DirectMoney, we are excited to be playing a major role in ensuring Australian consumers get a better deal on personal loans – a better deal for them, not for their banks,” he said.
Mr Porges said there will be a unique portal for brokers who use the DirectMoney platform – which is “ridiculously easy” to use.
“Once we become more developed with groups, we’ll develop specific platforms for each,” he told The Adviser.
“Eventually the data will be pre-populated, so brokers won’t have to re-enter the information, and we’ll be able to approve the personal loan at the same time or pretty close to when the broker is doing the mortgage.”
Brokers who use the DirectMoney platform are paid a flat fee irrespective of the size or length of the loan, Mr Porges added.