The non-banks will have to work hard in 2013 to take market share from the major banks, a key industry stakeholder has claimed.
Homeloans’ general manager for sales, Greg Mitchell, said the non-banks have to keep proving they can deliver in order to recover the losses in market share they have experienced since the global financial crisis.
“The majors have been increasing their market share – a trend which has been apparent for the past three or four years, post-GFC. It’s going to be a hard fight to actually claw that back because it is just so very competitive out there,” Mr Mitchell said.
Recent funding pressures on the majors, and the ensuing negative publicity, could work well for the non-bank sector, he added.
“The major banks aren’t always passing on full rate cuts anymore,” he said. “We’re in the same boat because we are dictated [to] by the cost of funds – but the majors can’t play that card as effectively anymore.”
Mr Mitchell said the non-bank sector’s recovery would be a long one, but signs of improvement are increasing.
“We’ll just keep on trying; keep on chipping away and increasing our share,” he said.
Brokers and the non-banks also need to work together to ensure that competition thrives, according to Mr Mitchell.
“It’s up to us to make sure that we maintain the level of service that we have to,” he said. “You can’t be a non-bank and just talk the talk. You’ve actually got to prove that you can deliver.
“But it’s also up to brokers to try and look for alternatives other than using the major banks all the time.
“We, as non-banks, now have great rates and great service. A lot of our issues recently have been related to brand awareness – and the majors play that card so well. But we’re getting there.”