Choosing the right mortgage or savings account can be an arduous task. So, often out of apathy or the fear of paying financial advisors, many consumers fail to explore all the options open to them.
To make the process easier, brothers Richard and Bob Brown came up with the idea of aggregating all the UK mortgage information within one website back in 1997.
The idea behind Moneynet is for the consumer to access information that has been available to the personal adviser for many years. "Mortgage advisors have used software packages to search and source the best mortgage products for their clients," says Richard Brown.
"Unfortunately, the man in the street has never had access to this type of information and would have had to seek professional advice, talk to individual lenders or wade through tables of rates to find the best product."
Initially, the site only provided UK mortgage information, but now has aggregate information on loans, credit cards, savings and current accounts and private medical insurance.
Richard Brown believes this information is best presented online as it needs to be in an interactive format. "It is impossible to provide this sort of service other than online because the rates change constantly and the user needs to be able to search our database according to their own preferences and circumstances."
Some consumers may be wary that the site pushes certain products or companies but Brown insists that it is fully independent and provides a comprehensive view of the market. "Most similar sites only work with a selection of providers meaning that the consumer is not getting that independent view of the market."
Despite the long list of dot-com disasters, Brown believes Moneynet is different because it has been run as a conventional business rather than as an Internet business. "We have built the business steadily and expanded our operation as the revenue allows." Moneynet has never invested heavily on advertising but instead developed strong associations with other sites in order to generate volume traffic.
When the site was launched the only source of income was from advertising. This proved to be insufficient so new revenue streams were created. Since 1999 Moneynet has generated revenues from transactions and the referral of business through to independent financial advisers. And since mid-2000 it has also generated revenues from online applications for credit cards, loans and mortgages.
Plans are under way to earn revenue from services aimed at niche markets. Moneynet also expects to attract some sponsorships for particular areas from product providers.
The site opened to a mixed reception from lenders. "There was some opposition from some of the larger lenders and some even refused to provide their information to us," says Brown. "But we now have the co-operation of all the major lenders and the majority of the smaller ones as well."
The product providers have their information published on the site free of charge and in return they provide Moneynet with updates when rates or products change.
Although the site acts purely as an information provider and not as a broker, it is still obliged to adhere to all regulations relating to financial matters.
"We have to be constantly aware of the associated financial services regulations and, in particular, we need to ensure that we comply with the Financial Services Act and the Mortgage Code. We also need to be aware of our obligations under the Data Protection Act."
Although Moneynet's staff are not expected to provide advice, they all come from financial services backgrounds. "When our users need advice they are referred to an appropriately qualified individual such as an Independent Financial Advisor." A freephone number for assistance and an online 'call me' button will soon be available to consumers needing further assistance. Even confused financial advisors may be tapping into this service.
Born: October 1997
Directors: Brothers Richard and Bob Brown
Funding: Privately funded from early 1997 until mid-2000 when a 30% stake was sold to Liverpool Victoria Friendly Society
Elevator pitch: Moneynet is a privately owned company, set up with the aim of providing independent, impartial and comprehensive information on the UK personal finance sector.