Issue link: https://read.uberflip.com/i/1441989
Currently, open banking enables lenders to examine a prospect's current account data, which is essential for assessing affordability. Since regulators demand that spending and income be categorized, evidence submission is still required. While the scope is likely to expand, current capabilities must be considered. ASSESSING THE CAPABILITIES OF OPEN BANKING ASSESSING THE CAPABILITIES OF OPEN BANKING 05 Which mortgage-related use cases is open banking relevant for? V A N I L L A M O R T G A G E S T O D A Y ' S M O R T G A G E S T O M O R R O W ' S M O R T G A G E S Straightforward mortgages are the bread and butter of lenders and present the best opportunities for open banking. • Small margin, so volume is key. • Standardized process. • Good target for automation. • Identify high-cost areas and remove bottlenecks. E N A B L I N G P R O D U C T S W I T C H Product switch currently represents over 40% of mortgage activity and is a process ripe for automation. Open banking can streamline the processes further and enable a near fully automated solution. • Product switches with no human interaction. • Staff to focus on value-add work. • Removing unnecessary robot tools. • Transferring tens of thousands of mortgages in a single day. S P E C I A L I Z E D M O R T G A G E S To maximize the efficiency of this mortgage type, lenders will require the advent of open finance (seen as the next step in open banking), which is expected to open up customers' entire financial footprint to trusted third parties, including mortgages, savings, pensions, insurance and consumer credit data. • Specialist lenders need to collect more data than open banking can currently offer. • Requires a combination of automation and manual intervention to enable decision criteria and data gathering. THE STATE OF PLAY IN UK MORTGAGES 01 WHY APPLY OPEN BANKING TO MORTGAGES? 02 OPEN BANKING POTENTIAL 03 THE FUTURE OF BANKING IS OPEN 06 07 OPEN BANKING IN ACTION CHALLENGES TO TRANSFORMATION 04