Lloyds Banking Group’s move to cut product transfer (PT) fees from next month might not shock advisers, but it still lands hard.
For years, LBG has been an outlier in a good way, keeping parity between PT and new business fees. It showed a clear acceptance of the advice given, the reviews carried out, and the risk advisers carry. Now that parity is about to go, and for me, it confirms a direction of travel we’ve seen across the group for some time.
Yes, they have offered some proc fee uplifts and introduced minimum fees, which are very welcome and should be commended for this. But, in my view, the PT cut speaks louder than the positives, because it slots neatly into a wider pattern of big lenders edging themselves away from advisers with retention products, even as they insist they value advice.
When BM Solutions – built on its commitment to brokers – says it will now deal directly with its own borrowers, that is a shift. When Halifax uses its app to encourage borrowers to contact them direct about the next deal, or suggests price comparison sites, with no mention of the adviser who placed the case, that is a strategy. When all this happens alongside a PT proc fee cut, it becomes difficult to argue this is anything other than a move to try and up direct business with customers.
And the timing is clever. Announcing it through clubs rather than speaking to brokers direct, and releasing it during Budget week, was obviously not accidental. It ensured less noise. Less immediate pushback. They picked their moment well and also released a flood of more positive mortgage news throughout the very same week.
But this sits in a much bigger trend that has defined the last year. Throughout 2025 we have seen a steady drip of measures that attempt to chip away at the position of advisers and the role we play. The removal of the ‘advice interaction trigger’ this summer, despite the industry pushback, was the clearest signal yet the regulator is not concerned about the line between advised and non-advised mortgage activity becoming thinner.
We then had the FCA’s DP, which seemed to open the door to yet more blurred boundaries around advice. And we saw a willingness from parts of the regulator to listen not to the advice sector, but to lenders who have downsized their branch networks, cut regulated staff, and now want to serve customers without taking the responsibility that comes with full advice.
This matters because it does not align with Consumer Duty. The overriding aim is meant to be positive consumer outcomes. Yet we now have major lenders rolling out tools and communications that move customers away from advice, and towards direct journeys. At the same time, the regulator is flirting with the idea that advice could be ‘light’ or ‘enhanced’, a structure that risks creating silos that help nobody.
All the evidence shows consumers want advice. They have voted with their feet every year since the Credit Crunch. They trust advisers, especially when the financial stakes are serious. Rates are still high compared to where they were. Income is squeezed. Vulnerability - as the FCA itself admits - touches half the population. This is not the moment to encourage more borrowers into direct channels where they risk missing something important and have fewer protections.
Yet this is the direction some big lenders appear to favour. And the pattern is becoming clearer. Less contact with advisers. More direct digital pushes. More attempts to hold onto customers without the adviser who placed the case. And now, less reward for advisers who carry out the same work and shoulder the same liability on PTs as they do on new business.
Looking ahead to 2026, I’m afraid to say advisers should expect more of this. More dual pricing. More attempts to draw existing borrowers back through direct channels. More comms that start and end with the lender, without recognising the adviser relationship that has existed for years.
Not all lenders will do this, of course. Many remain committed to the intermediary channel and see the long-term value in its resilience. But the largest players can shift the tone of the market, and right now the tone is not moving in a consumer-first direction.
That means advisers cannot afford to sit back. This needs to be a line in the sand. Brokers cannot be cut out of the conversation on advice, on fees, or on the role they play in ensuring good outcomes. If anything, the events of the past year show that advisers need to be louder.
We need to challenge lenders when they reduce the value of advice. We need to vote with our feet, to protect the consumer by working with lenders who want a collaborative approach with us and who are focused on the best outcome for the consumer. We need to challenge the regulator when it leans towards models that sideline the adviser voice. And we need to remind both that good outcomes come from strong, experienced, regulated advice, not from chatbots, apps, or direct retention strategies rushed out in the name of margin.
Product transfers are core to the market. Advisers carry out the same work, offer the same review, and bear the same long-term risk. Cutting fees for that, while pushing customers down non-advised routes, can only move outcomes in the wrong direction.
The adviser community needs to make that clear now, particularly to our clients, before the next wave of changes inevitably arrives.
