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Weather eye

It may be considered sad to be on holiday and thinking about the financial services market but I have to admit that it did cross my mind on a recent trip to Florence.

It was not the cosmopolitan lifestyle, the bustling Ponte Vecchio or the great food and wine that triggered the thought but the illegal street traders. I can hear some of you saying, hold on a minute, we are going through a tough enough time at the moment without you comparing us with illegal street traders.

It is not the illegal element but the diversity of sales that these people adopt that triggered the comparison. I remember in one day clearly being regarded as a prospect from one of the chaps touting a range of sunglasses.

The fact that I already had a pair on did not seem to deter him from his fact-find. On my return from lunch, unfortunately, the weather turned and we encountered some precipitation. The same guy now stood there with a range of umbrellas, doing a great trade as the tourists leaving their hotel in the morning in the sun did not think to pack one – but he did.

The problem is for this guy, when the rain came pouring down on his sunglasses trade, dampening sales, it could have meant no income for food or bills. Sound familiar? That drive for survival meant he had developed a multi-product offering. While the initial sale was at best cheeky and at worst annoying, the other products he had to offer were seen by his customers as essentials.

I know many intermediaries are sick of listening to commentators asking them to diversify but my point is from a customer perspective. This is what we should always have done and distributors who just pushed mortgage products are as much to blame as the broker who sits door-gazing, waiting for the next mortgage customer to walk through.

With gross lending in 2009 likely to be half of that of 2007, I would suggest these brokers buy themselves a good book as they could be waiting for some time for the sun to start shining again.

It is also important that the distributors provide the training, support and access to ensure that the intermediary is able to competently offer their customers a fuller product range or a referral mechanism so that customer needs are satisfied in a safe environment and the intermediary still generates income from the sale.

The other thing that impressed me about this Florentine street trader is the speed at which he could pack up his goods and disappear when the police arrived. This is not an option we have in financial services, especially with the regulator taking a very dim view of phoenix firms. It does, however, highlight the need to ensure you are compliant and competent when looking to move into other product areas.

My advice is to work with reputable brands, don’t look for loaded premiums for higher commission and don’t use the line “this is an unregulated product”, even when it is. Apply the FSA principles regardless, especially treating custo- mers fairly. Don’t forget, a customer can be for life.

Dev Malle is group sales director of Personal Touch Financial Services


Time for the super-prime

A new report from the Building Societies Association predicting the shape of the mortgage market in 2020 suggests that IFAs rather than brokers will take centre stage in mortgage distribution.2020 Vision: The Mortgage Of The Future, written by mortgage expert Peter Williams outlines some of the possible outcomes resulting from the changing funding environment and demographic shifts.

Broken banks

I’m waiting for the apology from Callum McCarthy. The one that says “I got it wrong in September 2006.”


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