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What happens when consumers demand something not in their interest? – Whitehouse

by: Phil Whitehouse, managing director of MCI Mortgage Club
  • 03/05/2018
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What happens when consumers demand something not in their interest? – Whitehouse
In financial services, like in any industry, we’re constantly trying to meet consumer demands. And, in many cases, doing so is the secret to success.

 

Customers want speed, we give them speed. Customers want new ways of paying, we respond accordingly.

Look at Amazon, for example. The online retailer has soared in the popularity stakes in recent years as a result of its ability to respond to the needs of the consumer – offering everything from same day delivery to dash buttons which allow you to reorder products at the touch of a button.

But what happens when consumers demand something that may not necessarily be in their – or the industry’s – best interest.

 

Social media advice

We talk a lot about robo-advice but recently things in this arena developed even further when Nuvo launched – allowing borrowers to get mortgage advice via a chatbot on Facebook.

One can understand how such an idea came about.

Social media has been a bigger phenomenon than anyone could ever have imagined.

Far from being a pastime for teenagers, sites like Facebook and Twitter have become popular with almost every demographic.

It is only natural that someone would develop a way of delivering a service like mortgage advice via these platforms.

 

Compliance concerns

However, this also raises some concerns – not least from a compliance point of view.

Is a chatbot offering suggestions classed as advice? How does it differ from a comparison site?

It claims to bridge the gap between traditional brokers and aggregators but unless someone is monitoring every conversation one wonders how that can be.

There’s no denying we need to be employing technology more effectively and developing innovations in line with other markets.

But we should also remember a mortgage is likely to be the biggest financial commitment a person is ever likely to make.

If it takes a little more time to get one than, say, a credit card, then perhaps that is OK.

 

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