Last month, in collaboration with FinTech North, we hosted the ‘Borrowers on the Brink’ webinar. We presented insights from our tenth annual consumer borrowing report, revealing the latest trends and attitudes towards borrowing and lending. The panel comprised industry experts with diverse backgrounds, offering unique and insightful perspectives on the subject:
Caroline Fowler, Director of Product and Presales - Consumer Interactive at TransUnion
Simon Padbury, CRO at Canefin
Sutherland Boyd, COO at Plend
Sam Goodacre, Director of Product at Lenvi
The event was opened by Joe Roche, General Manager at FinTech North, who welcomed attendees and set the stage. He then introduced Will Ellis, Chief Revenue Officer at Lenvi. Will provided an overview of the report's key findings and focal points such as financial literacy, vulnerability, the evolving role of AI in lending, and emerging attitudes towards Buy Now Pay Later (BNPL) services. He established the context by exploring the landscape of consumer borrowing and lending before handing the discussion over to the panel for a deeper dive into these critical issues.
Here are the key insights and takeaways from the webinar:
The impact of open banking on customer borrowing.
Sutherland Boyd, COO of Plend, highlighted open banking's transformative role in reshaping lending dynamics, particularly by extending credit to individuals marginalised by traditional financial institutions. She discussed how leveraging open banking data can assess borrower risk and affordability, fostering financial inclusion. Additionally, she underscored the necessity of transparent communication in the lending process, guiding borrowers through rejection and offering alternative options.
Caroline Fowler, Director of Product and Presales at TransUnion, expanded on the role of open banking in creating personalised consumer journeys and addressing the challenge of credit invisibility.
The role of AI in the borrowing landscape.
Artificial intelligence was a central topic of discussion throughout the event. Simon Padbury, CRO of Canefin, emphasised the need to balance AI technology with personalised human engagement in customer journeys. While AI offers significant benefits such as analysing data to detect unusual transactional behaviours and prevent fraud, it is important to use it carefully and transparently. The panel agreed that human involvement is crucial for providing empathy and nuanced understanding of individual customer needs, especially when dealing with vulnerable or financially excluded individuals.
Education in the financial industry and its impact on customer behaviour.
The discussion emphasised the critical role of clear communication, consumer education, and responsible lending practices. Sam Goodacre, Director of Product at Lenvi, pointed out the lack of financial education in key institutions such as schools, leaving younger generations unprepared to navigate their borrowing options. He stressed the importance of ongoing financial education throughout the loan lifecycle, especially in emerging areas such as Buy Now Pay Later services. The panel agreed that consistent education helps consumers make informed decisions and promotes responsible borrowing practices.
The importance of brand reputation in customer relationship building.
The report showed a shift in borrowing attitudes, with consumers prioritising low interest rates and brand reputation when choosing lenders. Caroline emphasised the need to build trust with customers by providing relevant information from the outset of their journey, which can lead to long-term relationships. Simon highlighted the importance of delivering innovative, customer-centred solutions to earn customers' trust, noting that a strong brand reputation can drive customer retention and acquisition.
The panellists offered deep insights into the complexity of the borrowing landscape and the challenges and opportunities it presents. The audience's enthusiasm reinforced the need for ongoing innovation and thoughtful exploration in the lending space.
Download the report to learn more about these insights and trends.