Now that we have technology capable of managing every aspect of a deal, from initial application through to final decision, what role do BDMs play in the industry?
Indeed, the impact of COVID-19 and multiple lockdowns means that many relationship managers haven’t be able to physically get out and meet clients in the same way as they would have done 18 months ago anyway.
It’s clearly a question that has occupied the minds of many mainstream lenders recently, who have responded by cutting the number of people in their front line, often centralising support by putting more emphasis on tech such as ‘Live Chat’.
I think this is a short-sighted and potentially dangerous approach, a view that is shared by the advisers I speak to. Not only are these providers narrowing the range of propositions they offer to advisers, which will reduce the quality of service, they are also stripping away expertise and knowledge from the industry.
Good advisers know their stuff and are well-versed in advising their clients on the best deals and recommending the most suitable lenders.
But they are only able to do that because they know they have the support of a well-informed BDM who not only understands the products their lender is offering, but also the needs of the borrower.
As we recover from the impact of the pandemic, SMEs will be looking for lending to help them grow. Many will need a lender that can support the often complex financial requirements of businesses that have weathered the COVID storm, while others will want to speak to a lender who has expertise of their industry sector.
For lenders to reduce or remove BDMs at this time, especially those that are based in the regions, is effectively saying they only want to deal with the simplest cases, and by extension, perhaps the most profitable deals.
I think the pandemic is an opportunity for the industry to rethink how we use this vital resource. We believe that BDMs can provide much-needed support and offer great value to advisers.
Recognise is a new bank, one that opened its doors to business last November when the country was still very much in the grip of the pandemic. We have invested in technology, great systems that will simplify and speed up processes for advisers and borrowers alike. But crucially, we have also spent a lot of time recruiting a team of BDMs based in the regions.
We have hired people based on their expertise, their knowledge, their widespread industry experience, and their desire to be ‘Relationship Managers’.
Our regional network of BDMs consists of people who understand the local economic conditions that are often specific to local businesses.
What this means is that we have BDMs that can focus on specific industries, like the owner-managed business and professional practice sectors.
Professional firms such as solicitors and architects, or SMEs in manufacturing and retail, will be vital to the recovery of the UK economy.
Yet these are the sectors that are often ignored by mainstream lenders perhaps due to lack of sector expertise on the ground and appreciation of their needs and challenges.
Because Recognise has a risk-based approach to lending, we also empower our BDM team to use their experience to look at each application on an individual basis, helping advisers with those cases which are more complex.
In fact, our BDMs are more than happy to speak directly to the end customer to talk them through the product or our process, if that’s the kind of extra support an adviser needs.
I think a lender’s BDM network reflects the effort they put into catering to their customers’ needs. If you are going to run a skeleton operation whereby you can only support advisers through a remotely-delivered, tick-box offering that isn’t able to look at individual cases or escalate queries, then it’s a completely robotic non-personalised service. Lenders who take this approach are likely to see an erosion in relationships and in time, a reduction in business volumes.
This is an industry built on relationships and we want to create the very best relationships with advisers, so they know that there is always an experienced person available for them to talk to.
So, to go back to my original question, ‘Do we still need BDMs?’ The answer is yes, we do, perhaps now more than ever.
