This report shares the findings of our thematic review into inter-firm commission or remuneration models in credit broking.
Who should read this
Our findings will primarily be of interest to credit brokers, or trade bodies representing credit brokers. Consumer groups and consumers may also be interested in the findings.
What our scope was
Credit brokers are firms that introduce potential borrowers to firms willing to provide finance. We considered whether inter-firm remuneration, such as commission paid to brokers by lenders, was resulting in consumer harm.
Firms we looked at include retailers selling goods on finance, online loan brokers, price comparison websites and commercial finance brokers. We did not look at motor finance brokers, who are subject to a separate review[2].
What we found
We did not find evidence that inter-firm commissions paid to credit brokers (excluding motor finance brokers) are resulting in significant widespread harm to consumers.
This does not mean harm is not occurring for reasons unrelated to commission, and our report identifies some examples of poor customer outcomes.
Next Steps
We will continue to monitor credit broking activity as part of our ongoing supervisory strategy and address harm in individual firms where we see it.