It’s all about borrower choice and they’re choosing brokers

Over recent months, major bank CEOs have outlined plans to renew their focus on lending
through proprietary channels, including digital and branches.

Should we be concerned?

According to the latest Cotality data for the June 2025 quarter, mortgage brokers facilitated
77.6% of all new residential loans, the highest market share on record. Broker market share
has accelerated since 2020 and shows no sign of slowing.

Australian borrowers have a choice when it comes to how they approach financing their
home. They are choosing mortgage brokers in record numbers, and for good reason. The
broker value proposition is simple yet powerful: choice, trust, and expertise.

Collectively brokers have access to more than 100 lenders, including many that borrowers
can only reach through a broker. A mortgage broker doesn’t win a client on price; it’s a
relationship built on trust and delivering outcomes.

That trust is underpinned by a broker’s legal obligation under the Best Interests Duty (BID) to
act in their client’s best interests. It’s an obligation no banker, with one eye on their sales
targets and year-end bonus, is required to meet.

Brokers bring deep expertise to navigate complex financial situations and find solutions that
truly fit a borrower’s needs. They go beyond the transaction, educating clients, helping them
get ‘finance-ready’ and guiding them through the most significant financial decisions of their
lives.

It remains unclear to me how lenders could deliver the personal connection and guidance
that thousands of small broking businesses provide every day. The challenge of supporting
borrowers navigating their financing needs is even more acute across regional and rural
Australia, where lenders have progressively closed their branches providing no physical
means of support to these communities.

Australia has one of the most consolidated banking systems in the developed world. Without
brokers, Australian borrowers would be worse off, with fewer choices and more expensive
mortgages. That’s an outcome no government, regulator or consumer advocate would
welcome.

Brokers don’t compete with banks, despite what we are reading in the media. Banks
compete with each other. Every pricing decision made by a lender positions them against
other lenders and is driven by their own growth targets.

Brokers also deliver immense value to lenders by connecting them with thousands of
customers they’d otherwise never reach. They do the work, preparing, educating, and
qualifying borrowers, enabling lenders to lend efficiently and confidently, without rebuilding
costly branch networks.

New and smaller lenders, too, depend on brokers to achieve scale and compete with large
incumbents.

That’s why it’s disappointing to again hear of channel conflict rearing its ugly head. Members
tell us of ‘under-the-counter’ branch pricing and cases where a borrower’s application by a
broker is declined but then approved in-branch, which raises legitimate concerns in my mind
of lender bias in credit assessment.

These practices undermine the foundat