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Leaders from the major brokerage and broking association have unpacked how lessons from international markets can help Australian brokers maintain their dominant market share.
In a panel session featuring Mortgage Finance Association of Australia (MFAA) CEO Anja Pannek and Mortgage Choice CEO Anthony Waldron at the Mortgage Choice Ignite conference in Hobart on Wednesday (2 September), the two leaders reflected on how overseas markets can provide Australian brokers with valuable lessons.
Reflecting on a multi-jurisdiction study tour conducted late last year across Canada, the US, the UK, Germany, and the Netherlands, Pannek noted that while the Australian market is “incredibly strong and is highly respected internationally”, local brokers can still draw valuable operational lessons from overseas counterparts.
Looking at the UK market, where broker market share reaches up to 90 per cent, Pannek said that regulatory frameworks can encourage consumers to seek professional guidance, but ultimate success comes back to broker value.
She told broker delegates: “In the United Kingdom, the regulatory framework basically initiates a need for either a banker or a broker to provide advice if the consumer wants anything other than their bank account balance... if you go to someone who’s deeply experienced, who actually can offer choice, who has your back and can help you navigate that, and do all the work for you, and advocates for you, why wouldn’t you?”
She added that other mortgage markets function very differently from Australia – noting that the UK, US, and Netherlands typically have long-term fixed rates, which can make mortgage broking purely transactional.
“You would think a market like the U.S. would have a very high market broker market share. It doesn’t. The product structure is fixed rate. It’s a transaction sport... and they just don’t get repeat customers. It’s a fixed rate product market,” Pannek said.
“Here we have a variable product, variable rate product market. Clients are highly engaged in their book... this is a relationship-based industry, and that’s how value is created.”
Indeed, the MFAA CEO said that many markets see Australian broking as a leading light for credit advice, particularly given the Great Australian Dream of home ownership.
“In the UK, it’s more accepted to be renting. But here in Australia, we have a passion for our homes,” Pannek said.
The duo also highlighted how overseas markets leverage cross-selling and broader financial solutions to deepen client relationships.
Waldron pointed to the UK market, where brokers routinely address secondary needs during the mortgage process.
“It’s the diversification aspect. It’s more than just the mortgage. There’s a component of what else is going to be needed at that point in time,” Waldron said.
“In the UK, it’s almost encouraged for brokers to do insurance at the same time as well. Now, is that where we should be going? Not necessarily, but it’s actually the identification of the need, an additional need for the borrower, which is probably one of the biggest things which I see we can apply.”
Pannek also pointed out that overseas regulators and peak industry bodies hold Australia’s best interests duty (BID) and broker framework in high regard, giving local brokers reason to be confident in their business model.
“What markets overseas really highly respected here in Australia was best interests duty, which they thought was exceptional, and that’s from speaking with regulators and associations, the remuneration structure, the adoption of technology,” Pannek said.
The AI disruption
Addressing the rise of artificial intelligence and direct-to-consumer digital platforms, both industry leaders dismissed the idea that technology poses an existential threat to the broker channel, but flagged that brokers themselves can be using it to free up their time to prioritise relationship-based value to clients.
Pannek highlighted observations from US giant Rocket Mortgage, an organisation heavily invested in digital disruption, which found that technology cannot replace human reassurance in high-stakes financial transactions.
“What they said to us, is that they purposely build their processes to put people in the mix still, because what they recognise is that people need people,” Pannek said.
“What they recognised is that it’s such a high-value transaction and it’s so emotional – because when you look to engage in a mortgage it’s not just the mortgage you are getting. It’s a home.”
Waldron agreed and emphasised that AI will automate repetitive back-office tasks and policy checks, freeing brokers up to focus on relationship building rather than replacing them.
“It can’t create that human connection and that decision for the mortgage, which is really a decision on the house and that security and prosperity of property,” Waldron said.
“What you can’t automate is the human connection, and I think that becomes a bigger part of the job.”
Waldron predicted that Australian bank branches will increasingly act as balance sheets, while brokers will solidify their role as the primary relationship holders.
“I think that is a shift that’s already happening,” he said.
Pannek added that Australia has the opportunity to serve as a global benchmark for the broker-led model.
“I think Australia’s got a huge opportunity to actually be the example for how other jurisdictions want to see their markets evolve,” Pannek said.
“I think it will be the human broker at the centre, but digitally enabled… trust, most importantly, is built in that human interaction, and if we just stay focused on that and really bringing that to life and preserving that, that will mean that your broking business is incredibly successful and sustainable for a very long time to come.”
[Related: Mortgage Choice to slash processing by 80% with new AI Suite]
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