Super-brokers and driving tips

They’re coming to the market and filling niches within niches. Small businesses dream of the day when all their financing needs can be arranged in a short phone call or e-mail – the slow process of applying to and being rejected by their bank is off-putting to say the least. Brokers, too, want to be confident of a consistent response from lenders, and lenders like to know what to expect when they see an approach from a broker, which is why many of them have a restricted panel.

Often the way they homogenise the panel of brokers they work with is to insist on NACFB membership. But another way is to bring on what we’re calling the “super broker”.

A super-broker brings simpler compliance with FCA regulation, plus other economies of scale. Not only that, but a lender can expect applications that precisely meet their criteria, which in turn builds a flow of trust that works both ways.

For the borrower, the super-broker won’t feel much different from working with a sole trader – the difference being the sense that there’s extra weight behind the lender approach, which makes things feel a little bit more like dropping in their local high street bank, only with a better chance of getting the funding. This gives borrowers that little extra bit of choice, as no doubt some will prefer the ambience of working with a sole trader.

The NACFB has a broad spread of broker members, and although we were braced to handle a cull in the broker population, as a response to FCA regulation and the resultant more stringent criteria for membership, the fact is that eleven months have passed since the new regulations came into force, and the worst case scenario hasn’t happened. That doesn’t mean everyone has enthusiastically embraced the hint of over-the-shoulder micromanagement that comes with being regulated. But at least we’re there to help with the fundamentals – for example, clarifying the surprisingly complex definition of “regulated business”. And once a broker knows they’ve got a system of compliance, once they’re in a rhythm of doing things the FCA-approved way, then it ceases to be something to worry about and turns into normal practice.

Compliance should feel like driving on the left – something so obviously in the best interests of everyone, and something so ingrained by repetition, that it wouldn’t occur to you to behave in any other way.