Speaking at the conference in Harrogate, held by Specialist Lending Solutions, mortgage intermediaries gave their views on areas of the market the regulator should be looking at to uncover anti-competitive practices.
Regulation and the regulator itself were raised as barriers to competition by three of the four panellists. Doug Hall, joint managing director, 3mc, said that a fear of future reprisals over giving advice on certain areas of the market was an unintended consequence of regulation which had been introduced to protect borrowers.
The FCA launched its Mortgages Market Study in December 2016 to examine whether competition in the market was healthy and working to the benefit of consumers.
After a consultation period, the FCA said it would focus its attentions on the tools in the market which helped borrowers pick mortgage products, such as lender or broker advice and technology. It also intends to examine commercial arrangements between lenders and intermediaries and third parties which may be damaging to the overall choice of products offered to consumers.
Rob Jupp, CEO of Brightstar Financial, agreed that unintended consequences of regulation was a big issue. “It [the FCA] should be focusing on disenfranchised individuals,” he said.
Mortgages for Business CEO David Whittaker took the regulation argument a step further and said the regulator itself was holding back competition.
He said:“Isn’t it an oxymoron when you put the regulator and competition in the same sentence? There has never been an industry on the face of the planet, in our lifetimes, where the regulator has been able to improve competition with regulation.
“Competition drives competition,” he added. “I do worry that the regulator will find a very small point to focus on, it will have an agenda at the outset, and even in the face of all other evidence it is very difficult to move it away from it.”
Vantage Finance sales director Jon Daniels said technology should be the FCA’s main focus. “I’m concerned there are some people [consumers] who are overly reliant on technology [to choose a mortgage product] and there is not enough investment in it to make it a solution which is more appropriate [than advice].”