Sixty Seconds On: The Future of Intermediation

Otto Thoresen

Director General

Association of British Insurers

The growth and dominance of intermediaries in retail financial services markets is beginning to worry providers, many of whom want greater contact with their customers.
Adopting innovative technolgy will be the key to lenders’ survival in a market dominated by intermediaries
Mortgage intermediaries have had an interesting time of late. The industry is fast moving, and not only have brokers had to adapt to the challenges of a regulated environment, but they have also had to embrace a number of technological developments that have impacted on the sourcing and processing of mortgage cases on an every day basis. These developments have enabled intermediaries to work more effectively, and to provide an exceptional service to their clients, and this rapid innovation looks set to continue in years to come.
One of the biggest developments in the mortgage industry in the near future is likely to be the availability and accessibility of data. Automated valuation models, which allow property data to be accessed at the touch of a button, and cut out the need for time consuming manual valuations, are already becoming common place. Whilst they are not currently available for all properties it is only likely to be a matter of time before data is held on much of the UK housing stock.
The potential benefits of being able to access data in this way are obvious, and in the future these advantages need not be limited to property. Perhaps it is even possible that borrower data could be made available in a similar way. For example, there is no reason why a client coming into an intermediary’s office, couldn’t have their entire social and financial profile gathered on a microchip that also provides access to their banking arrangements. With the use of wireless technology, personal data could then immediately be uploaded into the requisite systems for a mortgage application.
Although this scenario is still a long way from being reality, the fact is that such possibilities are already being investigated by financial and commercial institutions across the world.
Indeed the mortgage industry is already looking at ways of facilitating cross system communication, an initiative that could potentially irradicate the need for multiple data entry. Within the mortgage industry huge potential exists to improve accuracy, speed up transactions and cut out duplication. As IT develops, the potential advantages for mortgage brokers will know no bounds.
The likelihood is, however, that the gap will quickly grow between lenders in the industry who are quick to adopt innovative technology and those who are not. This gap is only likely to expand in the coming years and providers who make sure they are on the right side of it are likely to be those who are most popular with brokers of the future.
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