'Education is a big part of ensuring finance professionals are professional and effectively self-regulated'
As the chief executive of the Commercial and Asset Finance Brokers Association of Australia (CAFBA), the preeminent industry body for commercial brokers, people listen when David Bushby (pictured) speaks.
As luck would have it, he wants brokers to listen to what CAFBA is saying more than ever.
The association has been on a bullish education drive of late, with the recently launched PACE Premium platform aimed squarely at professionals seeking to make a name in the commercial finance space.
By virtue of being less encumbered by regulation than the residential mortgage space, commercial broking has fewer guardrails, which makes education more of a necessity than a luxury.
“We believe self-regulation is far better than regulation and education is a big part of ensuring finance professionals are professional and effectively self-regulated,” Bushby told MPA. “It is incumbent on an industry association like CAFBA to take the lead and work to maintain this status. CAFBA cultivates and champions financial professionals who are committed to achieving and upholding the highest standards in commercial finance.
“Ensuring that well targeted, presented and relevant educational courses are readily accessible to all, is a key part of enabling participants to reach those high standards.”
PACE Premium emerged as a result of a decision made by CAFBA a few years ago, when the association brought together all major lenders and aggregators to form the CAFBA Education Council.
Lifting standards
The aim of the CAFBA Education Council was to bring together the moving parts of the commercial finance sector “with a view to fostering an industry-led education initiative”, Bushby said. This fits into CAFBA’s wider mandate of “maintaining and lifting professional standards in commercial standards in commercial finance.”
Other initiatives that were borne from the CAFBA Education Council include CAFBA’s Certificate IV and Diploma in Financial Services, and its international Certified Leasing Financial Professional (CLFP) course.
All initiatives have seen strong uptake, said Bushby.
Discussing the rollout of PACE Premium, he said: "We have taken a two-step approach to our PACE courses. The first was PACE Freemium which comprises around 40 free courses for CAFBA members, including mandatory courses required for membership renewal. These courses are heavily utilised by members.
“The second step is Premium which has just been launched with 60 short courses (across a wide range of topics, from credit frameworks to financial analysis and P&L balance sheets to cash flow financing).
“All Premium courses have been developed to be relevant to anyone working as a financial professional in the area of commercial lending, from brokers, to lenders and those working for aggregators.”
A diversifying profession
CAFBA has taken the lead on broker education at a time when diversification is an increasingly prominent trend in the broking space.
This is a client-driven trend, with brokers becoming increasingly comfortable analysing businesses’ balance sheets and cash-flow statements in order to provide a full-service offering
Yet commercial finance and residential mortgages are not one and the same, meaning broker education is essential.
Bushby warned that newcomers to the commercial broking space risk trying too hard to meet the needs of their clients without having the expertise or knowledge to do so.
PACE Premium courses, said Bushby, “are specifically designed to help plug those knowledge gaps, providing baseline, practical knowledge all commercially focused finance brokers will find useful at times, whether at the start of their career, or as refreshers for those more experienced”.
When asked if the increasingly congested residential-to-commercial pipeline inspired CAFBA to launch PACE Premium, Bushby said: “I don’t think it is fair to say it ‘inspired’ it, but the increased levels of diversification of brokers into commercial and asset broking was certainly a consideration.
“We welcome good residential brokers who want to expand or move into assisting businesses with their finance needs, but working in commercial finance does require a different set of skills and knowledge.
“Our full suite of educational products now enables those looking to work in the sector to gain the knowledge they need,” said Bushby. “The PACE Premium courses will play a big role in that, as does our Bridging Diploma of Financial Services, which is specifically designed to assist residential brokers who are looking to diversify into commercial lending.”
Clearing up misconceptions
Despite the risks of diversification, Bushby said there were many misconceptions about the space that can unduly spook potential newcomers.
“There is no doubt it is complex and requires specialised knowledge,” he said. “However, this can be learned and through CAFBA and in the broking community, there is a lot of support to assist participants be the best they can be.”
Bushby recommended seeking out and absorbing as much knowledge from experienced brokers as possible.
“If you get the opportunity to work with experienced commercial and asset finance brokers, take the opportunity,” he said.
