We must free the market’s data prisoners

Consumers turn to advisers for their guidance, expertise, and ability to search the whole of the market, yet brokers themselves are often denied the same chance to choose the best customer relationship management (CRM) system.

Many brokers regretfully find themselves ‘data prisoners’, locked into CRM contracts which do not allow them to change providers without paying thousands of pounds in exit penalties. While technology has revolutionised the mortgage market in many ways, we must ensure all stakeholders can access and benefit from the developments.

Current state of play

A recent Smartr365 survey found that 37.5% of respondents were concerned about becoming a data prisoner when they signed up to an outsourced CRM system, the second biggest concern cited. The survey also revealed the scale of charges being levied on advisors seeking to leave their current platform. Most were charged between £1,000 and £5,000 to retrieve their data from their current CRM provider, but in some cases, respondents said the fees were as high as £20,000. If brokers do decide to take the plunge and pay the extortionate fees, the process can be hugely stressful and take considerable time, time that could be better spent supporting customers.

Impact

As a result, brokers are denied access to major technological improvements. Market-leading platforms, including Smartr365, automate much of the home-buying process, allowing intermediaries to generate a QR code which gives customers, introducers, and solicitors alike access to a shared digital space to safely exchange data. Customers can also use portals to verify their identity and connect with credit-scoring firms so that information is verified and packaged for lenders with less data entry. Clients can also monitor the progress of their application in real time using the user-facing CRM system, and even stay in contact after the mortgage has completed, dramatically improving customer loyalty. Denying brokers access to these innovative tools slows down the entire property market.

However, this is not just a problem for brokers, but also for consumers who will likely be frustrated by the delays caused by the slow, outdated systems. This harms the reputation of the individual broker firm and wider intermediary industry. Trapping brokers within CRM systems also reduces the competition among providers and therefore also their incentive to innovate, preventing the introduction of new and useful technology to the market.

Hope for a more equitable future

If CRM providers are unable or unwilling to improve their offering to brokers, then they must allow them to move to better platforms without imposing huge exit penalties. If somebody were to leave Smartr365 for example, or even if they simply needed their data for a different purpose mid-contract, we simply export all their data for them within 24 hours in whatever format required, without any hidden fees.

56% of respondents to the Smartr365 survey agreed that using new technology usually resulted in a time saving for them and their business, while 46% said it improved their efficiency when dealing with admin, making the prevalence of ‘data prisoners’ even more frustrating. Brokers can see the value in adopting new tech but are prevented from accessing it. Technology has hugely improved the mortgage market for brokers, lenders, and borrowers. We must therefore ensure that it continues to work for all parties, and that we have healthy competition in the market.