Digital change is radically altering consumer expectations in the
mortgage market and “raising the bar for what borrowers expect
from their home buying and owning experience,” according to
research published today by the CML.
Launched at today’s CML Mortgage Tech UK conference in London,
the research Digital Change and Mortgage
Borrowers says that technology has the potential to
differentiate what individual lenders have to offer to customers
and enhance the competitiveness of the UK mortgage market.
The research, which was conducted for the CML by associate
Accenture, included interviews with firms and customers across
the mortgage sector. The researchers also looked at developments
in mortgage markets around the world and how technology is
affecting other industries. From its interviews, the researchers
found that:
- 84% of companies believed technology could improve customer
experiences and relationships;
- 76% believed it could improve their own operational
capabilities;
- 68% thought it could put customers in greater control; and
- 40% believed it had the potential to unlock the power of
data.
From apps on which customers can arrange and manage their
mortgages to digital property searches and the potential of
technology to deliver automated decision-making, the mortgage
market is evolving rapidly. But the research also highlights the
challenges for lenders in a market in which two-thirds of
customers prefer to speak to an adviser about complex products
and value being able to ask questions and receive a personalised
service.
Lenders are investing heavily in technology to enhance the
customer’s experience and improve backroom efficiency and
profitability. As they do so, they will need to develop their own
commercial strategies to ensure they can react with agility to
future developments and remain responsive to customers in a
constantly evolving environment.
Technology also presents challenges for lenders, including the
limitations imposed by legacy thinking and systems, the need for
greater external collaboration and to keep pace with change, and
the way in which compliance with necessary regulation can inhibit
the pace of digital development.
Commenting on the publication of the research, CML director
general Paul Smee said:
“This report highlights the enormous potential of technology in
the mortgage market – a huge, process-driven industry with more
than 11 million customers. It is already enhancing what lenders
are able to offer their customers, as well as improving the
efficiency of work behind the scenes. The pace of change will not
slow, and firms will need to ensure that their plans for
developing technology are underpinned by the clearest possible
understanding of all the implications of digital change.”
