UK Finance's latest must-read blogs
UK Finance
The collective voice for the banking and finance industry, representing around 300 firms.
UK Finance has released its report Mobilising Capital for Net Zero Transition which outlines key asks from the banking and finance sector to the Government to mobilise capital in the UK to achieve Net Zero goals.
UK Finance is committed to supporting the net zero transition and recognises the critical role the financial services industry must play to achieve a just transition to the green economy.
In April, we welcomed the Government’s package of measures to move forward the UK’s transition. In July we started working with our members from the banking and finance industry to identify areas where a more specific set of policy measures is needed to support the Net Zero transition. In September, we noted the Prime Minister’s announcement setting a new timeline for some Net Zero commitments such as energy efficiency targets on homes and the transition to heat pumps.
While the Prime Minister has set out a vision to keep to our goals while maintaining public consent, policymakers must offer far greater detail to secure the private investment and lending needed so that we can all enjoy the benefits of a Net Zero economy and ensure the UK plays its part in mitigating climate change.
?Read the full blog post by Agathe Duchiron, Manager, Sustainability and Strategic Policy at UK Finance and Celia Escudero Gonzalez, Senior Manager, Management Solutions
Over the past decade, AI has enabled banks to derive insights from vast information troves and the value of analytics has shifted from historical insight to prediction, leading to better decisions.
Generative AI is the latest evolution in the AI paradigm shift from automation to intelligence to creation and is bridging the gap between insight and action.
When generative AI systems and large language models (LLMs) can both draw insight from large data sets, as well as understand, interpret, and generate human language, the time and effort required to act on insights is drastically shortened. And with LLMs we can unlock previously impracticable insights and manage the documentation to boot.
With this combination of forward insight and creative capabilities, the financial services sector is ripe for novel innovation, from customer services improvements through to credit risk understanding.
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Read the?full blog post ?by Cheryl Allebrand , Managing Consultant, Specialising in Artificial Intelligence (AI) and Automation, CGI .
Data from UK Finance reveals that 1.6 million mortgage customers will reach the end of their deal in 2024.
Given the massive influx of borrowers looking to remortgage, lenders must take full advantage of technology to help deliver innovative solutions that ensure consumers can access the most suitable product transfers in this rapidly evolving market.
Making the right decision
At a time when many customers find themselves at a crossroads with their lender offering an overwhelming array of product options to consider, technology must be utilised to support decision-making. Of course, some customers may choose to change lenders to access another deal, and when a professional adviser recommends taking this step, it is often the most prudent financial move.
But increasingly, the most popular choice among remortgagers is, indeed, the product transfer. According to data published by UK Finance, in Q2 2023 84% of remortgagers remained with their current lender instead of moving elsewhere. This marked a significant increase from last year when the average for 2022 as a whole was 77%. Product transfers are often attractive because the solution allows consumers to avoid prepayment penalties should they refinance with a new lender and can offer greater speed and stability as well as reduce paperwork.
Advanced tech and strong communication are key
Today, lenders can use sophisticated sourcing tools to match borrowers with mortgage deals available on the market, tailored to their unique financial circumstances. Consumers may be tempted to speed through the remortgage process as quickly as possible, however, the consequences of a rushed remortgage can be damaging, and lenders should guide consumers carefully to the most well-informed decisions possible – using technology to do the heavy lifting.
It follows that lenders should invest in communications tools to boost customers’ awareness of their financial options. AI-powered chatbots, for instance, are a helpful way to stay in regular contact with customers, and lenders can leverage interaction histories to provide customers with a more personalised service. Lenders should utilise these tools amid the current economic climate to emphasise the advantages of a product transfer such as increased efficiency.
Read the?full blog post? by Chris Little , Chief Revenue Officer, Finova