In a paper released this morning, ‘Feedback Statement - Call for Inputs: competition in the mortgage sector’, the regulator said: “Commercial relationships between different players in the sector’s supply chain - in particular the use of panels - might give rise to competition concerns.”
The Financial Conduct Authority has raised concerns about ineffective competition where lenders restrict distribution to a panel.
In a paper released this morning, ‘Feedback Statement - Call for Inputs: competition in the mortgage sector’, the regulator said: “Commercial relationships between different players in the sector’s supply chain - in particular the use of panels - might give rise to competition concerns.”
The paper also said some aspects of regulatory framework are having a negative impact on competition and there are opportunities to make more effective use of technology in information advice.
It added that some consumers are finding it a challenge to make effective choices about mortgage products.
Christopher Woolard, director of strategy and Competition at the FCA, said: “For millions of consumers a mortgage is one of the biggest financial transactions they will enter into in their lifetime so it’s encouraging to see firms embrace the spirit and the letter of our rules.
“At the same time, there appears to be more to be done to improve competition in the mortgage sector. Competition can play a key role in ensuring that the sector works well, delivering lower prices, better products and choice, and more innovation.
“Based on the evidence we’ve collected so far, we intend to launch a forward-looking market study later on this year, with particular focus on the roles played by intermediaries and panels.”
Paul Smee, CML director general, said: "We are pleased that the regulator has identified no significant faults in the market. This is testament to the level of commitment that lenders showed in implementing the new requirements that emerged as part of the Mortgage Market Review.
"Through our voluntary transparency initiative, working jointly with Which?, we are fully engaged with the consumer choice agenda that the FCA identifies as an area for study later in the year.
“We are already looking to make the kind of progress that will make it easier for consumers to compare and understand their options, and look forward to working constructively with both the industry and the regulator on this."
