According to a number of lenders and brokers in the specialist finance industry, it will bring with it the opportunity to innovate with fintech solutions.
“Like every other sector, the specialist finance industry will become much more cloud-based and able to function remotely in the highly likely event that situations like this arise again,” said Mark Posniak, managing director at Octane Capital.
He added that the sector should expect new technologies to be created that specifically tackled the issue of social distancing and valuations.
“It may take a while, but I have absolute confidence that the industry will innovate its way around this.”
Liz Syms, CEO at Connect for Intermediaries, and Marc Champ, managing director at Wharf Financial, share Mark’s view that there will be opportunities to do business in a more technologically advanced way.
This could include delivering virtual training, which we have already seen in the housebuilding industry, and using technology for signatures, ID checks and speedier applications.
“We have learned that virtual training really does work,” commented Liz.
“We will be able to reach wider audiences by delivering our training on this basis, and also help more advisers.
“We have also learned to appreciate more what an amazing industry this is and how even competitors are pulling together to help each other out in a time of crisis.”
“The importance of IT can’t be over emphasised,” stated Amadeus Wilson, director at SPF Short Term Finance.
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“It is essential that brokers ensure they have the most up-to-date systems in place and instigate a disaster recovery day twice a year to ensure all staff have sufficient ability to work remotely.”
In addition, some specialists have highlighted the Covid-19 pandemic has in fact strengthened relationships between borrowers, brokers and lenders, and believe this will continue after the crisis has passed.
“Borrowers and brokers will become increasingly loyal to those who stuck by them when times were tough and carried on working on rapport,” explained Paul Watson, head of origination at Blend Network.
“The strong bonds formed between brokers and lenders will come to the fore and hopefully will continue to deliver an excellent service to property investors and developers,” added Marc.
In terms of market recovery, could the bridging industry see a rise in demand at the end of this?
“With so many people across the country having experienced such a significant cash flow shock, short-term funding is likely to be in high demand, and I would expect to see an increase in appetite from all types of borrowers,” said Vic Jannels, CEO at the ASTL.
However, while the need for bridging may increase, it is expected that mobilisation within the industry may take some time.
“The economic fundamentals were strong beforehand, and if we get back to some degree of normality within three months, we’d expect lending to resume quite quickly, predicted Rishi Passi, CEO at Oblix Capital, “but there will obviously be some disruption to supply chains, both in materials and the re-mobilisation of the workforce.
“If the situation lasts longer, we’d expect to see some lenders exiting the market, and possibly some new entrants as we did in the last crisis.”