Experience vs qualifications: What's the industry benchmark?

Experience vs qualifications: What's the industry benchmark?


Following an announcement from the National Association of Commercial Finance Brokers (NACFB) about its recently updated commercial broker qualification, B&C wanted to explore the possibility that further qualifications could be introduced for brokers and the benefits associated with them, particularly in comparison to what has long been considered invaluable to bridging brokers: experience.

Speaking about the commercial broker qualification, Adam Tyler, Chief Executive of the NACFB, said: “We’ve always had a qualification for commercial brokers/NACFB members but we have now updated the qualification so it covers overall commercial finance better. 

“The qualification is gained through 60 hours of distance learning and multiple choice and situation exams taken at test centres throughout the country. The distance learning is not too onerous as it is spread over a period of 12 months. 

“The idea behind the exam is that it is basic, covering all aspects of commercial finance but from it can spring other exams, like asset finance or short-term finance – which is under discussion.”

Broker Arran Bardoe, Director at Temple Capital, suggested what the reaction might be if further qualifications are implemented.

He said: “Most brokers will react in a subjective way, going through the normal stages of:

- Concern about passing the exam (failure meaning no longer being able to trade);

- Concern about the time required to study during a busy working week;

- Indignation because they believe that their years of experience are sufficient to evidence their ability to do their role;

- Outrage about another FSA burden on brokers which is hindering our industry.”

He added, “However, none of these points are particularly relevant. In my view, while the above are not without grounds, I feel brokers must react more objectively to the issue and provide feedback to the FSA based on more pertinent reasons. 

“The first questions brokers should ask the FSA are:

- What problems currently exist in the mortgage advice market in the FSA’s view?

- How would further qualifications address these?” 

However Arron was quick to point out that, “Qualifications and experience are different things and complement each other – a bit like passing your driving test. The test makes sure we know the foundations of driving, but experience enables us to avoid accidents.

“That said, around half of drivers stopped learning the day they passed their test and should be retested or required to pass an enhanced exam every five years, which is possibly comparable to the broker community.”

He continued, “A manager at the Bradford & Bingley once told me: ‘There is a difference between 25 years’ experience and one years’ experience repeated 25 times’, which I have seen so often since. Many brokers still begrudge any lender criteria changes, undertake no Continuing Professional Development (CPD), never make time to attend free training events from providers, refuse to meet BDMs and only scan the ‘pinks’, if at all.”

Arron explained that the better networks undertake rigorous knowledge tests, observations and file checks, so they can prove their brokers have a demonstrable grasp on the issues the FSA is seeking to address.

Adam also stressed the importance of experience. “You can’t just turn up and be a commercial broker – you might have the technical knowledge but you also need the experience to truly understand asset finance, commercial mortgages etc. 

“The best way to gain experience and knowledge is through being mentored alongside an experienced commercial finance broker.”

Speaking specifically on commercial concerns, he added: “The philosophy of the NACFB is that we will mirror what the FSA does, which is why we have had a commercial qualification for many years. The FSA therefore sees we are doing a good job and lets us get on with it.

“If you are a regulated broker you have to have a qualification regardless of what your experience is. The brokers who have survived are those who have been able to adapt themselves to fit into a changing market, and those who have a strong commercial business background.”

Benson Hersch, CEO of the Association of Short Term Lenders (astl), commented: “My view is that generalisations are unhelpful. Some experienced brokers have skills and knowledge that more inexperienced brokers may lack but qualification may be helpful, particularly for newer brokers.”

It seems that after asking both a broker and those who would be in the position to offer potential bridging qualifications for their feedback, what has emerged is a focus on the importance of a combination of qualifications and experience. Whilst qualifications are desirable as representation of an industry benchmark, many brokers may still agree with Arron that “experience is the most important and pertinent element for any broker.” 


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