It’s not unusual for regulators, from all over the globe, to keep under review regulatory changes in other jurisdictions, but the recent Royal Commission report has received unprecedented attention – particularly in the UK.
The line that has struck a specific cord is: “An intermediary who seeks to ‘stand in more than one canoe’ cannot”; which came out of the conclusion that an unfair relationship existed between ‘duty’ (to a client) and ‘self-interest’ as a result of the way brokers are paid. UK regulators have grappled with the same issues for decades. The regulator there, the FCA, has always opted for ‘transparency’ regimes rather than direct market interventions of the type recommended by the Royal Commission. However, that does not stop UK brokers worrying about the changing practices in Australia and any possible ‘bleed’ into UK regulatory thinking.
As in Australia, brokers receive introductory fees from lenders (although some UK brokers also charge the client a fee) so it is not surprising that this aspect of the final report has received intensive comment in the UK intermediary trade press. Ironically, trail commission has only recently gained traction in the UK. So, brokers and intermediary groups are already ‘getting their retaliation in’ and are starting to spin the benefits to the consumer of obtaining mortgage advice, without the need to pay for it directly. The intermediary sectors across the globe continue to be key for consumers and lenders alike and their role in the market will continue to be debated.
If you haven’t already seen the final final report, it can be accessed on this link.
We will be exhibiting at #ACCELERATERegTech 2019 Doltone House on the Sydney Waterfront 6 and 7 March. The event will bring together 300 regulators, regulated entities, RegTechs, government, technology firms, allied associations and professional services together to examine regulatory and compliance challenges under one roof.
Why not pop along to our stand and chat to us about the Royal Commission Report, other regulatory challenges and how Yabber can help your business.