Four out of five finance brokers working within the asset finance sector have found the process of becoming fully FCA authorised difficult, according to United Trust Bank’s research.
Over half of the 136 commercial finance brokers who took part in the survey said that they had expected it to be difficult and had found that to be the case, whilst a further 25 per cent of brokers found the process to be more difficult than they had expected.
UTB said that around three quarters of brokers are now on course to being fully approved, but 16 per cent were not sure what their situation is and 9 per cent said they were not on course for authorisation.
Alongside this, 16 per cent of asset finance brokers who took part in the survey were considering not applying for full authorisation once the interim period expires and a further 6 per cent were as yet undecided.
Around 76 per cent of brokers intend to stay independent, according to the research, while 16 per cent said that they have already joined a larger broker group, with 8 per cent saying they are still considering the move.
UTB noted that one positive was that not a single broker indicated that they were leaving the asset finance industry.
Martin Nixon, head of asset finance at UTB, said that the research confirms some brokers may have under estimated what needs to be done.
“It is somewhat concerning that one in five brokers are still either considering not applying for full authorisation or are as yet undecided; the clock is ticking!
“The research also revealed that the authorisation process has persuaded some brokers to give up their independence and join larger broker groups with the loss of independence and sharing of commission being balanced against the assistance with authorisation and possibly access to a larger funding panel.”
ruth.gillbe@ft.com
