Lloyds Banking Group is considering linking its procuration fees to the quality of business submitted.
The lender says it does not have any immediate plans to change its proc fee structure but it is something it will “continue to review”.
LBG head of intermediaries Peter Curran says: “Improving quality is clearly a good thing and we are keen to work with intermediaries in a number of ways to make this happen. There are no immediate plans to link quality of business to proc fee but, as with all elements of our structure, this is something that we will continue to review.”
In July, Abbey for Intermediaries implemented a quality-based proc fee system, meaning networks would be paid a blanket fee based on the overall quality of their brokers’ business.
It is understood Abbey judges what proc fee its key accounts receive against a number of metrics, including the packaging of cases, the conversion rate of applications to offer and the overall quality of submissions.
Abbey’s changes meant proc fees for its key accounts now range from 0.35 per cent to 0.4 per cent, with the quality of brokers’ business now being the key factor determining the level of proc fee paid. Directly authorised brokers receive a 0.33 per cent proc fee.