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While aggregators are aware of the issue, regulatory barriers could be preventing progress.
A common theme uncovered when discussing the challenges in changing aggregators is that there is a lack of regulation to help protect brokers from these issues.
Further, each aggregator has its own unique methods for handling the exit of a broker. This inconsistency has resulted in ambiguous processes.
Compounding these issues are the varying processes between lenders. This can cause a large amount of rework for a broker and confusion for the client.
“Even if a broker has loan on the go for a client many lenders will shut down the broker’s access while they are waiting for the accreditation transfer to be processed which can mean delays and the broker cannot assist in moving the loan forward,” said AFG head of sales and distribution, Them Lam.
According to Lam, AFG is advocating to minimise delays from the transfer of lender accreditations.
“Most lenders require brokers to ‘apply’ for accreditation transfers when switching aggregators (even though someone’s credit rep number doesn’t change). This can take several weeks to complete and can only be lodged to that lender once the outgoing aggregator has removed them, and the new one has onboarded them,” said Lam.
“Most problematic is where lenders treat a transferring broker, who might have lodged deals to that lender for many years, the same as a brand-new broker, including to the point of requiring supporting documents.”
LMG's general manager, service centre and operations transformation Katie Modra said there has been added attention given to the process over the last year.
"Operations transformation, specifically onboarding, is one of our top four strategic priorities for 2025. Through our operations transformation, we’re removing friction from key broker moments," said Modra.
"We’re also advocating for more standardisation and collaboration across the industry, particularly around lender accreditations and data portability. Brokers are asking more of their aggregators, and that’s a good thing. It pushes all of us to be better. And we welcome that."
Each of the aggregators Broker Daily spoke to agreed the process creates challenges for brokers. Connective's chief customer officer Gingkai Tan anticipates the process getting easier so long as aggregators prioritise it.
"This will ultimately be determined by each aggregators willingness to commit their time and effort to improving the broker experience. It’s great to see some of the more progressive lenders like Macquarie already helping simplify the process by treating accreditation transfers differently from new accreditation requests," said Tan.
"We’re continuing to work with our lender partners and advocate for smarter, faster processes - and in the meantime, keep doing everything we can to ensure brokers who decide to join us can make the switch with minimal disruption and maximum benefit."
Finsure’s head of operations Kon Shizas said while aggregators can delay the process, there are factors that cannot be controlled, “such as checks conducted by regulators, and any pre-existing lender investigations that brokers may be involved in.”
“Relationships with the lenders are also a crucial component. Depending on the urgency of the onboarding, having a strong working relationship with our lenders allows for better communication and helps prevent brokers from losing business or missing out on deals,” he said.
Shizas said technology is being utilised more effectively to deal with these challenges.
Despite technology’s role in improving processes, the regulatory barriers cannot be addressed this way, prompting the desire for reform from industry heads.
Adding further fuel to the fire is misinformation. Specialist Finance Group’s general manager Blake Buchanan said brokers can run into trouble through a lack of clarity and understanding.
“Many brokers that we come across that have stories about switching challenges did not have the processes explained to them well with a plan in place to ensure that it goes as smoothly as possible with limited down time,” he said.
He urged brokers to have a plan in place before committing to a change. When handled effectively, it can go much smoother, with the transition completed in a matter of days.
However, Buchanan also believes there can be neglect at certain aggregators, keeping brokers stranded.
“Most brokers change aggregators because the grass is greener on the other side or due to circumstances. Some aggregators may have a vested interest in the process being perceived to be difficult so that they retain more brokers and some might not resource this area of their business as well as what they can as it may not be perceived to be a profit centre for them. I hope that others will improve so as to make the process better for all and minimise disruptions to brokers’ businesses,” Buchanan said.
Buchanan welcomed competition in aggregation as it gives brokers a choice and keeps aggregators on their toes.
“Brokers exist because of competition and by extension of them, aggregators exist. Competition drives us all to be better and where there is a better partner for a broker that enables them to grow or achieve their objectives, aggregators should be making this as efficient as possible for them and their business, after all, we are here to serve brokers,” he said.
Meaningful changes have been made
Thankfully, there has been progress made in reducing the burden of changing aggregators, such as ASIC reference checking, replacing separation letters, improving reference checks, and streamlining transfers. These additions are designed to protect both brokers and borrowers during transitions.
In response to the Broker Daily article, MFAA CEO Anja Pannek said that the reference checking and information sharing protocol introduced following the banking royal commission provided added regulation for broker background checks.
Previously, the reference checking protocol was limited to interactions between licensees. This left a gap, as many brokers operate under their own licence and collaborate with aggregators, who were not considered licensees.
Following ongoing advocacy by the MFAA, the law was updated in 2024, and ASIC subsequently expanded the protocol to include aggregators.
“This closed the regulatory gap and removed the rationale for requiring unregulated, inconsistent letters of separation,” Pannek said.
“A reference check needs by law to be completed within 21 days giving certainty to transferring brokers, whereas separation letters had no requirements as to timing, potentially leaving transferring brokers in limbo.
“What this now means is that letters of separation are no longer a key blocker for brokers switching aggregators. The MFAA strongly believes reference checking should now be the industry’s primary method of broker assessment and transition. It is a far superior and fairer alternative for brokers looking to make a transition.”
The National Compliance and Regulatory Forum, established by the MFAA, is working to address the hurdles in switching aggregators.
A key outcome of the Accreditation Working Group is to implement a Lender Accreditation Transfer Form, which allows brokers to transfer multiple accreditations with one consistent document. MFAA is actively encouraging lenders to adopt the form.
“Both lenders and aggregators spent significant resources and time managing these transfers – time better spent supporting brokers and improving service delivery,” Pannek said.
“We will continue to advocate for consistent documentation and faster onboarding, promote the uptake of the transfer form, promote the use of the reference checking protocol in lieu of separation letters, and champion technology and collaboration that enhances the broker experience.”
With brokers and aggregators alike voicing concerns with regulatory and lender barriers in switching groups, there are hopes reforms will be introduced to resolve challenges.
[Related: Switching aggregators: A challenge that needs addressing]
