DEVELOPING AND DELIVERING

Equifinance is gaining a reputation in the marketplace for meeting customers’ needs. Loans Insider met up with Tony Marshall to find out why

As managing director of Equifinance, Tony Marshall heads up a team he is rightly proud of; a team that has gone from strength to strength over the past year.

The lender has increased headcount on the regulatory side of the business, sales and distribution along with underwriting positions to ensure that its service levels are maintained and that key staff are in the right place.

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Notable recruits in the last 12 months have been Gary Smith, general manager, Rajiv Agarwal as director of compliance and Richard Croll in the role of regional sales manager (south).

“The first half of this year has seen a growth period for Equifinance, which I would hope has taken the business from a relatively unknown entity to a position approaching or leading to a mainstream lender,” says Marshall.

He explains that at this stage in the lender’s development, they prefer to be discreet regarding performance of the business, preferring to be recognised as a provider that develops products and solutions designed to benefit consumers.

“So far as I see achieving that primary goal leads to a successful business for the benefit of all its target stakeholders and a trusted brand,” he adds.

“It depends on what measurement we are discussing, but our primary goal is to ensure that our products and consumer solutions are satisfactory for the market we are in and they are designed for.

“Also that our relations and service to our broker partners (who are also our clients) are second to none because we also appreciate that their client is also expecting the best.”

He does stress that, with regard to commercial targets, Equifinance is on course to achieve its business plan for both its financial year end and for the whole of the year.

CUSTOMERS

Typically, Equifinance’s customers fall into two segments. The niche products are geared toward customers who are financially excluded on the basis of a poor credit profile but they are able to evidence that this was caused by a life event that created an income shock. This can be anything from redundancy, illness, divorce, business failure and so on.

“However, with our help they are able to improve their situation and we aim to assist them back to financial recovery and access to mainstream products,” says Marshall.

“I think too little is known or understood about the wider effects of a poor credit profile, which affects not only access to credit but also other ‘prime’ products such as general insurance.

“The long-term effects of a poor credit profile can substantially limit the customer’s ability to achieve aspirations such as moving jobs and increasing their wealth through contributions to pensions, savings and property purchases.

“We very much see our role in this as providing assistance to those customers to enable them to lead an aspirational and fulfilled life should they wish to.”

The second range of products do something similar. They, again provide financial access to an unlikely section of excluded customers, as Marshall outlines: “The Plus range as we call them are designed to act as a substitute solution for those consumers where an unsecured facility or re-mortgage may not be open to them but their credit profile is immaculate.

“This is often due to product restrictions in the terms offered by the unsecured market, for example maximum term, loan size and or availability of a rate because of some quirk in the credit scorecard of lenders.”

Equifinance works on a six to eight-week product lifecycle model and for the last 18 months it has either removed, added or amended its products at every release date.

“We have developed our solutions based on industry, customer and broker feedback and where we identify a particular gap in the market,” explains Marshall.

“Having worked in the first charge market for some time I believe that as the sector develops and becomes more mainstream, products will become even more dynamic as lenders and brokers seek to offer different features in order to expand the market.

“In addition, product and price are not the only marketing tool and as such we are exploring all areas within our reach to improve our augmented solution.”

NEW HORIZONS?

Marshall reveals that at Equifinance they constantly explore expanding their product range into new areas. This is one of senior management’s key focuses at the moment and will be throughout the remainder of this year and into 2019.

“Some of the ideas are very conceptual at the moment and as such they may never happen due to the complexities involved,” he says.

“I totally understand the difficulties and risks that diversification and expansion bring and I always take my hat off to businesses that do this and make a success of it.”

Equifinance is currently funded by a combination of senior debt from institutional lenders and private investment and Marshall explains that they purposely structure their products with a life cycle – “this ensures that we constantly review them for modification or refresh, and are very agile if we identify new opportunities to fill a gap in the market,” he says.

“This does mean that our funding partners in turn need to be agile and understand our underlying strategy. We have no complaints with our current suppliers, finding them very accommodating. Therefore, in the short to medium term we see no reason for change, however, as the business grows our requirements may change but not any day soon so far as we can see.”

MARKET CONDITIONS

So, having worked in financial services since 1998, does Marshall think the secured loan sector is performing well or should it be doing better?

“Interestingly, we are currently rewriting our strategic plan and as such we have looked back to 2008 when the industry was originating five times the current volume according to FLA statistics.

“It’s always a little disappointing when the industry appears to remain flat as it has been over the last couple of years; however, the sector had a long way to climb, it has also dealt with the introduction of FCA regulation and MCD.

“I remain confident the industry will see increased growth over the next few years driven by an increase in marketing spend, innovative product design and development along with consumers and intermediaries becoming more aware of the products available.

“Second charge mortgages provide a true alternative to some forms of lending. It is for all of us to ensure that this knowledge is passed on and the industry is positive about itself and proud of what we do.”

With an experienced team behind him and a strategy for growth, it’s no wonder Marshall is postive about the future.