Effective Communication Skills, Professionalism, And Regulatory Compliance For Finance Brokers Are Essential. (70 Characters)

Maintaining client records for enhanced customer service

Questions:

Task 1.

Develop & nurture relationships with clients

1. List AND explain 3 key attributes a typical client and/or referral partner would expect to see from a finance broker before they would be prepared to do business with them.
 
2. There are three fundamental standards, social, business and ethical that you need to be aware of and comply with when interacting with other professionals, referrers and clients. Choose one of these standards and provide an example of how you would comply with this standard.

3. A colleague of yours is considering joining LinkedIn to help their business. Outline 3 tips you might give them when using LinkedIn.

Task 2

As finance professional you will be required to maintain files and records of all documents produced by the business.

Explain the processes you have implemented in your business to ensure that you can store and retrieve documents.

1. When discussing a consumer loan with a client, when are you required to give them a credit guide and list 3 pieces of information that must be included in the credit guide?

2. With reference to ASIC regulatory guide RG 209, outline the two circumstances where a loan may be deemed unsuitable for a client.

3. Describe 4 benefits of conducting an internal compliance audit for your business.

4. Joseph Lee a new broker has breached the MFAA’s code of practice. Describe what penalty might apply to Joseph for this breach.

5. Under the NCCP, licence holders must record all breaches of the Act in the breach register. How is ASIC informed of these breaches?

Task 3

Apply principles of professional practice to work in the financial services industry
 
1. Environmental sustainability is becoming an increasing consideration in business planning and the wider community. List two (2) environmental sustainability practices that you might consider implementing in your business and the benefits.

2. ASIC, COSL and FOS are three key agencies that provide a critical role in the Finance & Mortgage Broking industry:

Explain the responsibility of the three independent statutory agencies central to the regulatory framework.

3. Prioritising tasks are an important part of successful planning; describe how you would prioritise tasks for yourself on a daily basis. Consider in your answer some of the categories you might use for tasks.

4. Positive feedback to other members of your team or business can be very motivating. Outline and explain two ways you might provide feedback in a positive manner

5. Explain what the term CPD means and what is ASIC’s requirement in terms of CPD hours (you will need to refer to ASIC’s regulatory guide 206)

Task 4

Provide Finance and Mortgage Broking Services

1. Outline why it is important as a broker to keep your client records updated and how you could use these records to generate more business.

2. When referring your clients to other professionals for assistance what 3 items are important to check about the other professionals before you make the referral.

3. With reference to RG 209 outline the three steps that set out the expectations of responsible lending.

Task 5

Develop and Maintain in-depth knowledge of products and services used by an organisation or sector

1. Describe what is meant by a repayment holiday and what types of clients may find it useful.
 
2. Outline two ways that you could maintain your product knowledge.

3. Your client is looking to borrow $150,000 but does not want any extras or “bells and whistles”, he just wants a home loan. Suggest a product that you think may suit him and explain why.

Tips for using LinkedIn for business purposes

Credibility: The ability to convince a client is an effective communication skill of the finance broker. Eun and Resnick, (2012) opined that financial products require salesmanship skills.

Keep track of details: An efficient finance broker must keep a track of all transaction details and maintain all complicated paper works for the purpose of future reference.

Professionalism: The broker should categorize his activities in a tactful schedule in order to maintain transparency in the transactions.

In case of interacting with clients the finance brokers must comply by the ethical standards and while efficiently delivering a transaction the finance broker must maintain act of integrity, provide high standard of service, act in a way that promotes trust, treat the client with respect and take responsibility of any default.

Tip 1: Never miss an opportunity to connect

Contacts are the currency of LinkedIn hence the business person using LinkedIn should not miss a chance to connect with any of the present LinkedIn member.

Tip 2:  Map the prospects

With the help of the activity records of the MNCs it is possible to map out the person who is in charge of the business decision making and thus helpful for the purpose of approach for business products.

Tip 3: Efficiently use the search engine

LinkedIn has an advanced search engine facility which will help a business person to find prospects by surname, company, location or keyword.

The use of Electronic Document Management System helps in digitization, indexing, storage, processing and retrieval of important documents in order to facilitate work process of finance professionals. This system will minimize the cost of document processing and increase the value of information (Grieve, 2013).

The three major information given by the Uniform Consumer Credit code are namely to protect customers from obtaining credit to finance their transactions, ensure that adequate credit is provided and govern the credit industry in general. The code also requires the creditors to disclose the terms of credit to the consumers.

As per the ASCI guidelines the loan is deemed to be unsuitable fewer than two conditions

If the consumer is not able to show a feasible financial situation: Before issuing a loan the ASCI will judge the consumer’s amount and source of income, length of employment, fixed and variable expenses, credit history and assets.

If the consumer’s requirements and objectives are not justified: In this regard the ASCI will review the credit amount required, timeframe of the credit, purpose and benefit of the credit and flexibility of the credit.

• Internal audit can provide management with independent assurance on diverse range of tasks and also help the business to make fair presentation of financial statements.
• Internal audit compliance helps the business to identify risks so that the business can mitigate the risk and achieve the targets.
• The audit also prevents loss of assets and resources and ensures reliable financial reporting.
• The internal audit helps the management in maintaining effective internal controls.

As per the MFAA’s code of practice the penalties applied to the brokers on the breach of norms may make it impossible for the brokers to recover their commission. Moreover the norms prevent the persons under the age of 18 years to enter into broking activities (Madura, 2012).

As per section 912D any significant breaches are reported to the ASIC. IN case of risk of failing to identify the suitable breach all breaches are reported to ASIC. The breaches are recorded in a Breach register in writing. The breach being reported to the ASIC must contain the date of breach, description, duration, how the breach was identified and rectification of breach. The report should be addressed to Financial services Regulation, regulatory compliance.

Green building: This practice helps in reducing environmental impacts by making sustainable designs, construction, materials and innovative practices like water efficient design and product recycling.

Green purchasing: Availing sustainable procurement and supply chain process and also engage in sustainable promotional process in order to promote the availability of environmentally sustainable products.

ASIC regulates the financial services by contributing to Australia’s economic reputation and wellbeing enhancement. The major responsibility of ASIC is to ensure fairness and transparency in financial markets.

COSL provides free, independent and impartial dispute resolution service for non bank lenders, finance brokers, credit unions, building societies, trustees, mortgage managers and servicers.

FOS provides quick resolution services for complaints of small entities as an alternative to the civil court.

• Create a task list
• Leverage the organizational skills
• Set time schedule for all tasks
• Prioritize the tasks according to importance and skills
• Create a time plan for successful completion of the tasks

• To provide information specific, issue focused and constructive feedback will help in motivating the employees in a positive sense
• To avoid any kind of implicit messages suggesting that the work was wrong will be able to make a positive impression in the mind of the consumers (Madura, 2012).

CPD or Continuing Professional development is the means by which people are required to maintain their knowledge and skills relating to their professions. AS per the norms of ASIC regulatory guide 206, the retail advisers and responsible managers should complete an annual CPD training plan which will include update of knowledge in professional areas having constant changes like law, economics, finance and new product markets.

The maintenance of client records will help to cater to the future needs of the clients effectively and hence the business will be able to provide enhanced customer service. Moreover the enhanced customer service also helps to make more new clients for the business.

Before referring the clients to other professional’s three factors are to be judged effectively namely the social standards, ethical standards and the professionalism of the professional. The professionalism should include compliance of records and effective management of transactions. Moreover ethical norms like honesty and integrity should be also present within the professional.

• Primary obligation is to conduct an assessment for the suitability of the credit contract
• Verify the financial situation of the consumers
• Verify the terms and objects of the contract

Repayment holiday refers to a short period of time during which an individual can stop making payments towards a loan because of financial problems. Generally people with high mortgage loans and other credit obligations will find this scheme useful since they will be released from the burden of loan repayment.

The product knowledge can be maintained with the help of constant increment of the knowledge with the changes in the society and environment. Moreover with the help of extensive market research it is possible to increase the product knowledge further. The business can also gain product knowledge from competitors review, employee’s opinion and supplier’s information.

The client can take the option of 12 month discounted variable rate loan which will help the client to buy a new home or make investment in property with 12 month discounted variable rate. This will reduce the burden of interest of the clients (Madura, 2012).

References list

Eun, C. and Resnick, B. (2012). International financial management. New York, NY: McGraw-Hill.

Grieve, I. (2013). Microsoft Dynamics GP 2013 financial management. Birmingham, UK: Packt Pub.

Madura, J. (2012). International financial management. Mason, OH: South-Western, Cengage Learning.