Two years into operations, low membership numbers and financial reality force NZ's only membership-based industry body's hand
The Finance Brokers Association of Australia (FBAA), headed by outgoing chief executive Peter White (pictured), has announced that it is ceasing its operations as a member-based industry body in New Zealand, citing low mombership numbers.
Established a litte over two years ago, the FBAA hoped to replicate its Australian membership-based model across the Tasman, even though NZ brokers, unlike their Australian counterparts, are not required to be part of an industry body.
Alongside low membership numbers, the FBAA also cited new licencing and commission structures by some lenders that have made the market harder for advisers, thus requiring even more time and finances "that we can no longer commit".
The FBAA intends to continue advocating for brokers in NZ through working with regulators and government bodies.
The full statements can be read below:
Just over two years ago the Finance and Mortgage Advisers Association of New Zealand (FAMNZ) was launched to provide a voice exclusively for finance and mortgage advisers.
In a market where the role of an “adviser” covered a range of professional services, our goal was to provide world-class expertise specifically for our sector in the areas of professional development and support, and to help increase market share through better advocacy and engagement with regulators, lenders, and consumers.
While these goals were being achieved, and the need for strong industry representation remains, unfortunately membership numbers have not reached the level required to make FAMNZ financially sustainable.
We thank those advisers who supported our industry through their membership of FAMNZ.
We also understand the hesitation of other advisers to join, because they haven’t been represented well in the past. But the reality is that without broad support, FAMNZ is unable to continue in its present form as a member-based industry body.
We are however, still committed to supporting advisers, and will continue directly working with regulators and government to help advance and improve the industry for the benefit of the entire Australasian region.
The Finance Brokers Association of Australia is the country’s largest and most respected body for finance and mortgage brokers, and has financially supported FAMNZ since its inception because we believe in New Zealand advisers. We still do.
We were motivated to make this investment by a desire to help build the industry here, just like we have done in Australia where around 75 per cent of mortgages are completed through brokers.
Just imagine the difference for advisers (and the outcomes for consumers) if this could be replicated in New Zealand.
We knew the market was different here, and that unlike Australia, advisers didn’t have to be a member of a professional organisation to deal with aggregators and lenders.
However recent changes in licencing and commission structures by some lenders have made the market even more difficult for advisers, and require even more time and finances that we can no longer commit.
We are proud of our significant achievements even in this short time. Our engagement with regulators including the Commerce Commission has directly resulted in better outcomes for advisers and consumers.
When we commenced, our industry had very little public profile and we discovered that most mainstream journalists were unaware of how our industry operated or what we offer consumers.
Our extensive media engagement and public promotion of advisers through the media has helped more journalists and consumers better understand the benefits of using an adviser for lending and mortgages.
Our hope is that others across the industry will build on what we have started. New Zealand advisers deserve nothing less. For our part, as mentioned, our work with the country’s regulators and government continues, and we will always be advocates for our Kiwi colleagues.
