Borrowers with simpler needs and a good level of knowledge, will increasingly look for easy, quick and, in some cases, execution-only options, Mike Jones, managing director of intermediaries at Lloyds Banking Group told the conference, as the two industry heavyweights discussed the current state of the mortgage market in a joint panel.
Smith (pictured) added: “Brokers are going to have to change, adapt and adopt new ways of doing business via new technology that deliver those service expectations which consumers now want.
“A significant proportion of that will be in the mainstream… where slick low-cost processes get the customer to the point of knowing they are going to get a mortgage at a much earlier stage in the process.
“So I would say challenging times ahead for the broker market.”
However, advisers still have the edge over so-called robo advice, according to Smith.
In most cases borrowers’ needs and circumstances are more complicated than they would appear on a screen, he said.
Advisers can continue to work with their customers to understand and establish those needs and find the best borrowing solutions.
He added: “Robots don’t empathise, algorithms don’t engage with their customer, it takes that human touch to see the difference between what people say and what they really mean.
“I think there’s a great opportunity for adviser to provide better consumer outcomes.”
Jones said: “Human beings supported by excellent technology feel like the answer to me too.
“To be very clear, brokers are the centre of the future for Lloyds Banking Group… I vote for human brokers every single time.”
Opportunities for advisers
One of the most significant opportunities for the future is the growing number of people who own their property outright and need to tap into the equity, Smith told the conference.
He said: “It’s a key market… They’ll be thinking how to unlock the equity they’ve built up – they are the same generation that faces severe demand on the bank of mum and dad, the same generation who are less and less likely to have a final salary pension scheme.”
Jones also stressed that product transfers are an important area for brokers.
He said: “These are your customers, these should be your retention opportunities as well.”