Over the next 12-18 months the industry will be infiltrated by a change in data use to take out some of the “pain points for the consumer” during the mortgage process, according to panel participant Derek Garriock, head of innovation at Experian.
Where customers choose to share their information, this will not only mean pre-population of fact finds, but can also then indicate the outcome of their affordability checks, he said.
Ian Major from fintech firm Runpath Digital said richer data on borrowers should mean companies are able to introduce better products, leading to improved consumer outcomes.
He added: “For us as businesses, that means we should embrace change.”
Miguel Sard, head of Santander mortgages, broadly agreed and said the lender is trying to use data to “identify needs”.
He added: “When we are able to identify needs, it is easier to provide better solutions.”
And in some cases, it means the lender is able to reach out to customers up to six months before they would otherwise realise their own needs.
Sard warned that dismissing potential changes in data use in the mortgage industry could see some firms losing their customers.
He added: “We are learning a lot, and seeing that there are better relationships and outcomes to be had with our customers.”
Over time, consumers will in effect have a “data passport” that gives a single overview of their financial habits, which they can then share to choose with relevant companies and organisations, according to Garriock.
Sceptics believe the majority of people will be reluctant to share their data and that they distrust financial organisations. Global market research from Mintel revealed that although anxiety peaks among the 55+ age group, two-thirds of 16-24 year olds do not sign up to new company accounts due to data worries.
However, research has showed people are actually very trusting of their bank, Garriock said.
And, in fact, people will be willing to share their data if the value of doing so is good enough.
Garriock told the conference in research where he has showed consumers propositions that would improve their financial well-being and driven by sharing data, around 70-80% of people say they would consent to share their information.
He said: “The challenge for organisations is about getting that value proposition right – so that it meets the customer’s requirements and they will share their data.”