The opinions expressed here are those of the authors. They do not necessarily reflect the views or positions of UK Finance or its members.

With an average of seven–10 days for a new product to be launched onto the market, it’s simply not fast enough to keep up with the pace of change required in our current and future financial landscape.

Since the mini budget from the Truss government, the financial sector has suffered under increased interest rates and subsequently, financial products on the market underwent a shock withdrawal as lenders worked around the clock to pivot and adapt to the changes in real time. The result was exhaustion from a lender’s perspective and confusion from borrowers.

These disruptions have seen borrowers and lenders entering into a new phase of constant change, where contingencies are a necessary and expected part of the relationship between the two. The events of September 2022 ushered in a new type of market where agility is key, and by extension, mortgage products have needed to be built with adaptability in an effort to withstand the changes and improve resiliency.

Competition remains fierce in an already challenging market, but equally, the opportunities for tech to continue to offer user-focused and adaptable solutions for lenders and borrowers is clear. Dynamic and granular pricing engines, for instance, could drive success for those willing to adopt a faster, more efficient response. This could see the seven-10 day market turnarounds become a thing of the past.

This brings back the point that moving away from outdated legacy systems to a more flexible and dynamic product model approach. Inevitably, this will improve the lender’s offer and meet the needs of existing and new borrowers. Flexibility is key to surviving in a volatile market, and with that a priority shift towards investing in tech-led solutions.

A forward-thinking approach can help achieve the flexibility required by adopting a more holistic approach to product development, including automated product pricing and digital tools designed for rapid adaptability. A move away from a one-sized-fits-all model will offer much more stability to lenders and borrowers, as well as potentially offering borrowers better products. An ‘always on’ pricing approach, for example, can adapt to real-time changes within the product, reducing the cost of labour to change a fixed product.

Innovative digital tools that can keep up with swift market changes must become a vital part of origination platforms. The product to market timeframe is an opportunity to offer products and platforms that are built with the leading edge of tech tools that can keep up to speed and adapt to real time changes without an unnecessary time lag.

Ultimately, faster and more personalised decisions can offer the capacity to sustain the changes in the market, improve relationships between borrowers and lenders by focusing on user centric solutions, and close the gap between legacy systems and what’s possible for products in the future of mortgage technology.

The UK mortgages and savings market is complex. Our vision is to be the most recommended technology partner and we do this by providing services and solutions that simplify, streamline and enable lenders and savings providers to meet the needs of their customers and partners. Find out more about our suite of solutions for financial institutions on our website.

Finova are delighted to sponsor UK Finance’s Annual Mortgage Lunch on 22 May.