Agents

 

Agents are primarily incentivised for the amounts they collect not for the money that they lend. A typical commission structure for an agent would see them receive a small amount for taking on a new customer plus 5% of the value of loan instalments they collect.

 

Agents are the linchpin of our home credit model. The face-to-face contact our agents have with customers in their homes each week means we have a unique insight into our customers’ circumstances. If customers’ circumstances change, for the better or worse, we are able to adapt our lending decisions rapidly, based on the latest information.

There are some 28,900 agents working across the seven countries in which we operate. They are the public face of IPF and are key to ensuring we offer customers a trusted, reliable and professional service. They visit each of our customers every week. In the course of a year our team of agents will make around 100 million customer visits.

The majority of agents are self-employed, although in Hungary local regulation requires that we employ agents.

Generally, agents are able to work as many hours as they choose and often combine their part-time agency work with another job or family commitments. This makes the job very convenient especially as they tend to operate in their own communities. Agents’ remuneration is predominantly based on the amounts they collect, not on the volume of customers acquired or loans granted. This promotes responsible lending.

A typical commission structure for an agent would see them receive a small amount for taking on a new customer plus 5% of the value of loan instalments they collect. An established agent will typically receive around 80% to 90% of their income from collections and service around 70 to 100 customers.

Agents play an important role in deciding whether to make a loan and determining the appropriate levels of credit to issue to customers. They are required to document the income and expenditure of the customer before issuing a loan to determine whether the customer has sufficient disposable income to repay the loan. They are supported in this process by our credit management systems, which use statistical models to determine the credit risk of applicants.

When we enter a new market we initially select agents through advertising in the local press or through leaflet distribution. However, in our established businesses, many agents were previously customers who know us and our products well.

New agents complete a structured induction programme, which lasts around three months, and are supervised by one of our field managers. All agents benefit from regular support and guidance, and meet their manager at least once every week. A manager will typically supervise between 10 and 15 agents depending on the number of customers they have.

As part of our Treating Customers Fairly (‘TCF’) initiative we are developing an Agent Charter which clearly sets out what support they will receive from us and our expectations of them. It also stipulates that they must meet a range of commitments, including health and safety, customer service and responsible lending.

Because agents are collecting and supplying cash to customers, procedures for personal safety are in place.

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