Lenders may look to reward quality business with greater commissions, one industry stakeholder has claimed.
Speaking at a media briefing in Sydney yesterday, Fujitsu executive director industry group Martin North said the new licensing environment will encourage some lenders to increase the commissions they pay to certain brokers.
“In my view, I think it is possible that we will start to see lenders pay greater commissions to their quality brokers,” he said.
In February this year, St George tweaked its commission structure to reward brokers with high conversion ratios – something other lenders will look to replicate in the future, according to Mr North.
Of course, it is not all good news for broker commissions.
Mr North said the exit fee ban would force some lenders to introduce or increase their clawbacks.
“Overall, I think what we will see over the coming 12 months is a rebalancing of commissions,” he said.
“Some commissions payments will be trimmed, while others will be increased to reward quality business writers. At the end of the day, commissions are still very high in Australia in comparison to international standards.”