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Brokers don't have to fear being replaced by AI or other fintech platforms as home loans become entirely electronic transactions because the market is still too complex and confusing for consumers to navigate alone, argued Brett Spencer, chairman of Opica Group, during a panel discussion capping of the FBAA National Industry Conference on the Gold Coast last Friday (24 November).
"These firms and companies that are out there saying that digital loans are going to replace you, they're the ones in the digital space. I think it's bullshit, and 55% of all loans are coming through brokers because consumers are too confused and technology won't fix it, it can't fix it," said Spencer, a technologist who has built digital platforms.
Spencer was part of a panel of experts consisting of Kim Cannon, founder and managing director of Firstmac; Blake Buchanan, general manager of eChoice; Peter White, executive director of the FBAA; and Robert Allen, senior manager of deposit takers, credit & insurers at ASIC.
The panel answered questions sent in by brokers, concluding a busy day of networking and learning from an array of motivational and educational speakers.
"Back in the old days, we wrote more loans, we wrote them quicker, and we wrote them faster doing it on pieces of paper. Technology has made the processes more difficult ... because what technology has done is taken a simple mortgage of me giving you money to buy a property or refinance, which should be the simple transaction, to having 50 variances of it," Spencer said.
Cannon pointed out, however, that as the customer changes, so too do brokers. "Technology is here to stay and you guys have to learn how to use it," he said.
"[People] can apply for a loan, they can do their banking, they can do everything with a thumb. Technology will change the way we're doing things and I agree with Brett, years ago, it was simple, but we only had one product to sell."
"Online is a lead generation tool ... and it's from there that we have a process where we take that customer through a journey and you still have to have humans doing that journey," Cannon said.
White echoed this, saying that while machine learning is increasing, it won't remove the human element. "The mundane, grunt work that is repetitive, computers will step up to the plate and continue to take over this sort of role, but it doesn't take you out of the equation. You can spend more time doing more productive things."
Buchanan has been in the industry since 2002. He said he's seen bust and booms, fluctuations in the market and the GFC. On those previous occasions, broker market share went down.
"Arguably we are in a similar circumstance for the last 18 months, international investment, what's going on with rates, policy changes, interest-only/investment; interestingly, for the first time in 15 or 20 years through adversity, broker market share is increasing and I think that's a very important thing to remember," Buchanan said.
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