Funding Conduit For Smaller Brokers - Credit & Car Finance September 2002

By Brian Rogerson, Deputy Editor

With the expansion of broker businesses in the UK consumer finance industry, come innovative methods of helping them to develop. "The smaller consumer finance broker does not often get the opportunity to develop a link through to larger funders," said Steve Carroll, Managing Director of Unity Facilities Ltd (UFL). "That is where UFL comes in. Essentially, giving selected brokers a chance to place their business with well established lenders."

UFL was formed in January 2000, initially in association with DSG Financial Services Ltd (DSGFS). Carroll explained, that in reality, few consumer finance brokers are able to supply the minimum volume of business levels required by major funders. "This limitation," he said, "has restricted the development of many respectable but small brokers. With the formation of UFL, brokers are able to stream deals through us and we subsequently place them with mainline funders in quantities large enough to be viable."

Carroll has a broad career history in consumer finance, including spells with UDT, GE Capital, Woodchester and On: Line Finance. He was invited by Richard Hoggart, Manging Director of DSGFS, to form UFL as a separately run operation and with a specific programme for growth.

The company currently employs four internal staff ("including two very experienced underwriters") who stream the deals towards the most appropriate underwriting criteria of associated funders.

Carroll assumes responsibility for selecting potential supporting brokers. "If we see an individual who has the capability to start up successfully, has extensive industry knowledge and is ambitious, we believe we can take that raw ambition nurture it and assist in developing a stable and profitable business."

Carroll describes UFL's task as essentially to manage the relationship with brokers on behalf of funders. "We offer brokers a range of 17 different products from 5 lenders, and are able to place business from within the prime and non prime sectors." he explained. "We also provide them with a sophisticated proposal and management information system, with in house training and monthly news updates."

In addition, UFL organises annual conferences, allowing brokers to benefit from the opportunity to compare marketing initiatives, discuss broker ethics and responsibilities, and learn about legal issues, fraud avoidance and awareness techniques. "Operating alone, brokers can live a rather isolated initiatives," said Carroll.

So far as funders are concerned, Carroll believes that those supporting UFL trust the company to closely supervise relationships with brokers. He said: "We are in a very privileged position and recognise that UFL could not have succeeded without the support and encouragement of our associated funders. We have to repay that faith and our first responsibility is to protect the funder from potential risk. We act as a filter for deals and our filter net is finer than that of the brokers themselves."

Carroll admits that the company's success is in no small way due to the influence and reputation of DSGFS. Indeed, Richard Hoggart is a co director of UFL.

"We have a broker-base of 21 at present which we are seeking to reinforce but in a measured and controlled manor," explained Carroll. "We would like UFL to be regarded as a responsible intermediary and a viable way for small brokers to grow their businesses."

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