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Regulation set to force rethink for small firms

Regulation will hit many smaller players in the mortgage market, fears MCCB chief executive Luke March.

At the BSA conference, March revealed that in 2002 there were 7,814 firms with only one member of sales staff. He predicts these will become unauthorised introducers of new business, leave the market or join mortgage networks.

March said the demands and costs of regulation from October 2004 will inevitably mean that many firms leave the market. Some firms may join the networks, which he believes will be a much more significant part of the market once regulation starts, but he is concerned that the number of unauthorised introducers will rise significantly.

He says: “A serious effect of regulation will be that a number of smaller players will become unauthorised introducers and will continue to do just as well tomorrow as they do today, without having to be regulated.”

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