While there’s nothing wrong with call centres, when it comes to tailored support for individual companies you simply can’t beat the personal touch of a longstanding contact who understands your business and is there for you.
Brokers should see this as an opportunity, not to step into the banks’ shoes as such, but to fill the gaps that they leave. For one thing, the high street banks are still lending, and brokers are becoming an increasingly important gateway to those options as well as the rest of the market. This is crucial because if businesses looking for funding think their only option is to approach alternative lenders they may spend or risk more than they need.
For example, SMEs may not know that, rather than plumping for unsecured funding through an alternative lender when security might not be available, they may still be able to access the enterprise finance guarantee scheme via the high street banks, where the government can provide a guarantee up to 75 per cent.
The banks may no longer be as visible on the high street but there is still a way in, even if it’s not through the ‘front door’, and that’s via brokers who can act like a virtual bank manager, keeping an eye on the whole of the market.
Brokers can also extend their support beyond the basics of borrowing; we’re in a great position to support companies through all stages of their growth and development, by understanding and guiding them through the different pressure points such as moving to bigger premises, taking on more staff, investing in plant and manufacturing equipment and so on. We can help them source insurance and link them with trusted professional advisors including accountants – in short, we can provide a link between all the partners in the way that bank managers used to, years ago.
I know you’ll have heard me say it before, but people buy people, and a good broker can be the centre of all the relationships and key components a company needs for its business transactions and financial arrangements.
Keeping up with the fintechs
While the banks reduce their numbers there is of course a corresponding increase in the fintech side of things where designated lending platforms do their business purely online, and many believe this will change the face of the broker market.
I disagree. By relying too much on automation and algorithms these platforms aren’t able to offer a personalised service to potential customers who may have a request that’s a little different to the norm, or who might be in circumstances that on the face of it make them a bad investment, but which in fact offer a great opportunity for those willing to take a risk.
Brokers need to pick the best part of the tech now available and put it together with our individual expertise, giving our clients the best of both worlds – ease of access and a really smooth customer journey, but with that personal touch.
As the traditional lenders go through their changes and the disruptors join the market, brokers can offer the continuity that’s so important to business across the UK.
Paul Goodman (c)