It had to happen. The bandwagon has been gathering pace for some time but it now seems that you can’t turn round for new entrants into the debt solutions market. This is a healthy response to the fact that there is a large and growing need for advice on debt and the means of helping people out of the hole they are in.
Inevitably this means that although there is greater competition among providers to draw in the intermediary market as a logical distribution point, the quality of what is being offered to intermediaries and their clients veers from excellent to shambolic and it is not easy for intermediaries to judge a debt solutions provider without trying it first.
The main complaints we hear about other providers at TCF Debt Solutions range from a ‘one product fits all’ mentality to a total lack of dialogue and feedback. The worst aspect is when it is clear that the so called provider is no more than acting as a post box for the real provider and has no real knowledge or understanding of debt solutions but in acting as a go between is able to pick up a fee.
However the issue that is least raised by intermediaries and which is a timebomb of significant proportions, is that few if any debt solutions providers provide a cast iron guarantee that they will not cross sell the client of an introducer, either during or after a debt management plan or IVA. The main concern I have is seeing intermediaries walking into relationships and giving away their greatest potential asset, namely their client. After all, when these DMPs and IVAs are finished, there will be great opportunities to provide new advice on house purchase, finance and investment. However, without a guarantee in place, those clients become a massive resource for debt solutions providers to cross sell themselves or sell to other providers.
So my message to intermediaries is to look to safeguard future income by ring fencing your clients and only using debt solutions providers, like TCF Debt Solutions, which ensure that your client is not sold any products during the debt solution process and guarantees to let you know when the debt plan is finished so that new advice can be given by the adviser who introduced the client in the first place.