Four industry leaders have shared their insights about the challenges and opportunities in the current market for mortgage brokers, during an event hosted by non-bank lender Pepper Money.
Insights Live 2023, which featured 13 speakers and was held both in person and via streaming at Rosehill Gardens on July 26, aims to equip asset finance and mortgage brokers with valuable information to navigate the ever-changing financial landscape.
Speaking during a panel discussion for mortgage brokers, Anthony O’Flynn (pictured above far left), director of IDA Mortgages and Finance, said there were many challenges he experienced “day in day out”, from changing lending policies and serviceability issues to interest rates and compliance.
But the prevailing trend he found most interesting was that clients currently have “a bit more knowledge” about what they wanted compared to many years ago.
“From interest rates to what the market’s doing, before they didn’t even know other lenders but through the Internet, they now have the ability to research what’s out there,” O’Flynn said.
O’Flynn said a broker could look at the closing knowledge gap as both a challenge and an opportunity.
“A little knowledge can be a little dangerous, but it gives us the ability to sit down with clients and talk to them about what their understanding of the product is but also provide the solutions to meet their needs.”
Amelia Pignone (pictured above centre left), director and senior lending specialist at LendX, agreed with Flynn about the challenges in the market.
“We’re all experiencing the same challenges whether it’s serviceability or the changing market,” Pignone said. “Nowadays, it’s not just about changing interest rates but finding a solution.”
But in terms of opportunity, Pignone championed the need for mortgage brokers to diversify into other asset classes.
“It’s a great time to be diversifying your business, tapping into other parts of the industry whether it be asset finance or business. I think it’s a really good time to be doing that.”
The double-edged sword of innovation
Now in its seventh year, Insights Live showed that innovation continues to be a hot-button topic.
For Steven Meek (pictured above centre right), chief information officer Australia and New Zealand at Pepper Money, technology was a “double-edged sword” that wielded both challenges and opportunities for brokers.
“It’s such a great time to be in technology because the advancements in AI, data, and modernisation creates such opportunity for brokers, lenders, and customers to improve the way we all do business together,” Meek said.
While the pandemic was very disruptive in our lives, Meek said it also drove a “seismic shift” in people’s willingness to use and embrace digital and technology solutions.
“Three years ago, we never would’ve ordered food through a QR code,” he said. “Digital drivers’ licences didn’t exist. Tap to pay was still in its infancy and we were mainly having face-to-face meetings.”
“Now you’ve got new technologies like generative AI that are creating huge opportunities like taking the administrative burden away for all businesses.”
The flip side, said Meek, was that in the past six months particularly, the innovations had opened the door for cybercrime.
“Probably two-thirds of the Australian adult population has been affected by the Optus-Medibank-Latitude cyber breaches. That’s really made it paramount now that we all protect the sensitive information that we all deal with in lending,” Meek said.
“The rise in digital is great but it also came with an equal rise in cybercrime. Australia is no longer under the radar when it comes to cybercriminal activity, so we need to all work together to ensure we are protecting our businesses, customers, and people.”
Hussain Mufti (pictured above far right), financial adviser at Mufti Finance, agreed with the thoughts of the other panellists when it came to challenges and opportunities.
“Two challenges from the top of my head, would be compliance and clawbacks – I think we all have a pain point there and both connect in a way for us,” Mufti said. “Since it increased, compliance is taking longer time to do those loans and get those across, so you have to invest more time and team members in order to get it done.”
In terms of technology, Mufti said it was a “big opportunity” for brokers.
“It just depends how we can implement that tech into our businesses and what sort of tech will actually suit you as a person and as a team,” Mufti said.
“There’s a lot of things out there and you don’t have to implement every single one of them. Just implement the ones that work for you and your processes and if that makes you 20% to 30% better that might save you time to write more business or spend it with family and friends and go on a holiday.”
Designed for both asset finance and mortgage brokers, Insights Live was held across two stages and four sessions.
Former Olympian and high-performance coach Dan Collins was the keynote speaker while Pepper Money chief financial officer Therese McGrath headlined the event, presenting a market outlook.
This year’s event also introduced Pepper Money World, an interactive exhibition space designed for networking and collaboration.
What challenges and opportunities does the current market bring? Comment below.
