It is a shame that it took a lender to step up to the mark and highlight the importance of advice for consumers. On behalf of the intermediary community, I would like to say thank you to Lee Gladwell and Platform for spearheading a campaign to help educate the market on an issue which is at the heart of why consumers are better placed when they use an intermediary for financial services.
While there is a call to define advice, I think the strongest PR this message provides an intermediary is that they do indeed give advice. We are currently faced with a situation where the mortgage intermediary competitors are mainly the product manufacturers – the lenders. Many lenders make non-advised sales and others provide one product range and call that advice.
The FSA has indicated that it will be keeping a closer eye on the advice provided by lender branches but in reality we know this is a monstrous task. One could argue that non-advised sales should have been tackled in the mortgage market review but that looks like a missed opportunity.
As a consumer, is it just expertise on a product range you would want your adviser to have? Or would you want the comfort of them living and dying by the advice and service they provide, often based on significant market knowledge and real experiences? Would you want to know that they have access to the thousands of products available and have the reassurance that you can discuss your Bupa protection policy one day, your Assurant buildings and contents policy the next and your Halifax mortgage the day after?
As a new mortgage customer, would you want a one-stop shop, whether you need a newbuild, a self-build, equity release, flexibility on credit history, are self-employed or are best suited to an offset?
The answers to these questions are obvious but we have not been very good at getting this message across. It is not about highlighting what others cannot do, but what we can.
There is an opportunity for us to maximise this PR and, speaking for Personal Touch, we have already started to develop pre-approved financial promotion material which our advisers can start to use to get this message home.
With considerable uncertainty and economic fragility, the timing is perfect. Consumers need robust advice, whether it is about income protection or the type of mortgage that suits their needs.
However, it is also good timing for lenders who have indicated that the cost of acquisition is often better via the intermediary channel compared with direct, especially when some have experienced capacity and service problems themselves.
As intermediaries, we need to secure our position as the route to full and proper advice and get to a point when the consumer feels anything less is not good enough for them.
Dev Malle is sales & marketing director at Personal Touch Financial Services