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Brokers who diversify into debtor finance and personal loans can “increase their income stream with a minimal amount of work”.
Debtor finance firm Scottish Pacific and personal loan service Fair Go Finance said brokers could also grow their client conversion rate by offering extra services.
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Scottish Pacific chief executive Peter Langham said debtor finance is a realistic option for brokers because all they need to do is learn about the products and then outsource the work.
“They’re increasing their income stream with a minimal amount of work,” he told The Adviser.
“Once you get to know the product, it’s a relatively easy way of earning income because they don’t have to do all the work they would do on a home loan.”
Mr Langham said Scottish Pacific worked with aggregators AFG and Plan Australia, but was also trying to increase its broker network.
Fair Go managing director Paul Walshe said the firm had worked with up to 100 brokers in the past and processed personal loans regularly for about 15 brokers.
He told The Adviser that brokers who offer personal loans tend to be above-average performers.
“It’s not something every broker is going to use, but the brokers who use it ... well, they find they convert more clients and they get very good customer referrals,” he said.
“It’s about providing a solution to the client and the broker establishing a pipeline of sales for the future.”
Mr Walshe added that a personal loan could help a client pay off their credit card debt so they could qualify for a mortgage later.
“If you’re offering more solutions, you’re going to be getting better client conversion rates and more referrals from those clients,” he said.
