What is an aggregator?

A broker joins an aggregator and signs a membership agreement covering fees, commission splits, compliance obligations and exit terms. The aggregator then grants access to its lender panel and technology platform: CRM, lodgement software, comparison tools and reporting dashboards. When a customer needs finance, the broker uses those tools to compare finance options, prepare the application and lodge it with the chosen lender.

On settlement, the lender pays commission to the aggregator, which takes its agreed share and passes the remainder to the broker, handling reconciliation, GST and reporting along the way. The aggregator also monitors file quality, runs audits and provides ongoing compliance oversight. Each month the broker receives a commission statement setting out which loans settled, what each lender paid, the share the aggregator kept and any clawbacks deducted.

Building direct relationships with 30 or 40 funders, each with its own accreditation, technology and compliance requirements, is not practical for most brokers. An aggregator bundles all of that into one relationship. A well-stocked panel lets the broker match more borrower needs, from a straightforward home loan to a complex commercial or chattel mortgage deal, and a single platform for lodgement and tracking saves time compared with using each lender's own portal.

Aggregated volume also gives brokers access to better commission structures than they could negotiate alone, and the aggregator's file review and audit programs help brokers meet their responsible lending obligations.

Aggregators are paid mainly from the commissions lenders pay on settled loans. Under a commission split the aggregator retains a percentage of upfront and trail commission and the broker receives the balance. Some aggregators charge a monthly or annual platform or membership fee, sometimes in exchange for a more favourable split, and franchise-model aggregators may add licensing fees and marketing contributions.

When comparing aggregators, brokers look at net earnings on a typical deal rather than the headline split, along with panel relevance, technology quality, compliance support and contract terms: exit notice periods, restraint clauses, data ownership and what happens to the trail book on leaving. Switching is possible, but trail book portability, customer data transfer and re-accreditation with lenders all need managing.