The Council of Mortgage Lenders chairman Martijn Van Der Heijden has hit out at “hidden procuration fees” for distorting consumer choice.
Speaking at the trade body’s annual conference in London today, Van Der Heijden, who is also head of lending at direct-only lender HSBC, lumped proc fees in the same category as staff incentives.
He said: “We have to make distribution work for the customer – the quality of advised sales is sometimes inconsistent.
“Hidden procuration fees, the deferentials that exist, staff incentives can distort choice.
“Sometimes the product sale fails a key test that I think we should always hold ourselves against – the product that was chosen should be the right one for the customer. That should be true all the time.”
He added that the banking and lending industry has more work to do to develop a relationship of trust with its existing borrowers and with the borrowers of the future.
He said: “Many of who, rightly or wrongly, see us as the cause of problems rather than the providers of solutions.
“All these three things that we know point us in a single direction – to show our customers that they are genuinely at the heart of our businesses.
“We are capable of acknowledging the market weaknesses that caused us problems, as well as capable of knowing what a good market looks like. And we are ready to move on, to build that successful market of the future.”