IF there was one blunt takeaway from the BVRLA Leasing Broker Conference last week, it was the pragmatic and highly sensible advice from Alphabet’s Richard Chadwick (pictured above right): “Get a plan by the end of October!”
Richard was speaking in a panel at the end of the day which focused heavily on Consumer Duty and what leasing brokers should be doing to meet the requirements of the new Consumer Duty.
Asked what his take was on Consumer Duty, Richard said:
We have to establish that we have to do it. It’s not as hard as it looks - but please get a plan by the end of the month! Communication is important. Funders need to know what brokers expect from us - and I’m talking collectively about all funders here.
The BVRLA has already provided a vast wealth of Consumer Duty material which brokers can use, and which was outlined by legal and membership director Shashi Maharaj.
And a key date in the timeline is that a board should have agreed their implementation plans by 31 October.
Marc Ireland from EY in his presentation on the regulatory landscape told delegates:
Focus on your implementation plans. The key thing is: what does the board know about consumer duty ? And have you appointed a Consumer Duty champion? The FCA will be asking for copies of the plans - remember to include everything you have done to evidence your work - and take the credit for all your work.
Andy Bruce (Fleet Alliance) and Paul Bulloch (Concept Vehicle Leasing) reflect on their different approaches to Consumer Duty implementation
At the end of the Consumer Duty presentations, a more personal broker-led approach was introduced by Paul Parkinson, chair of the broker committee and CEO of Synergy Car Leasing, who was expertly hosting the event.
The two brokers offered perspectives from both ends of the leasing broker spectrum.
We’ve all learned that it's a fundamental upping of the game that puts governance at the centre of what we do. What do we sell and who do we sell it to. Ultimately it’s a good thing. Well crafted regulation jolts businesses into making them more successful in the long run.
Second, it's an enormous piece of work - it will eat up a huge amount of management time. So embrace it, but don't underestimate it.
Meanwhile Paul Bulloch saw new Consumer Duty as a way to present the value leasing brokers offered, since it took the emphasis off price and focused on consultancy.
We’re seeing it as a positive. Our approach is to break down the implementation and tackle it bit by bit. For us it’s an opportunity to take the customer away from the rental price and look at the proposition in a more holistic way. It offers us the ability to talk to customers and explain to them the value we are providing.
Consumer Duty and unregulated broking
The panel also considered whether there was any reason for brokers dealing in unregulated finance products – the consensus was that why have two different sets of systems because from a cost perspective brokers only needed one system.
Do you need different monitoring and oversight to run two sets of people? Probably not. Singularity wins the day.
Commission and complaints to become greater issues
Other speakers in the morning session around Consumer Duty included Roger Potgieter from Shoosmiths, who confirmed that the issue of commission would remain a hot topic in motor finance, even though conditions would remain relatively quiet in terms of PCH and BCH broking.
And John Wightman from the Financial Ombudsman Service (FOS), who suggested complaints to FOS would rise as economic conditions worsened. “It hasn’t materialised yet. But having good processes in place for customers that are struggling will be key.”
The BVRLA Leasing Broker Conference took place on 06 October at the Royal Institute of British Architects in London.
Broker funder Alphabet was the lead sponsor, along with broker funder Leasys, plus Ebbon Group, MotorLease, QV Systems and Trakm8.
Broker News was the media partner of the event.
Photos: BVRLA
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Ralph Morton is the leading journalist in the leasing broker sector and editor of Broker News, the website which provides information and news for BVRLA-registered leasing brokers. He also writes extensively on the fleet and leasing market in both the UK and Europe.
