By Jerry Mulle, UK MD of Ohpen
Learnings from 2024:
“2024 has been a challenging year for fintech and financial services. Shaped by significant elections in the UK and the US, fluctuating inflation rates, base rate cuts, regulatory shifts, and growing consumer scepticism, the different factors have created an unpredictable and turbulent environment for the sector.
“As we move into 2025, many of these challenges are expected to persist. Rising consumer demand for mortgages in the UK – driven by Labour’s ambitious housing development plans – will coincide with a shift in the demographic of applicants.
Gen Z have also been reshaping the mortgage landscape, with many relying on diverse income sources from freelancing and side hustles. This evolution in consumer profiles is pushing mortgage providers to rethink their offerings, creating opportunities for more personalised, niche products. Meanwhile, rapid regulatory changes will require lenders to remain agile, ensuring they meet compliance standards while staying competitive.
Leave behind out-of-date legacy tech:
“These dynamics are transforming what were once considered niche services into mainstream offerings. Fintech companies are uniquely positioned to support this transition, providing solutions that help both traditional banks and new players adapt to an increasingly complex and demanding market. Consumer expectations for tailored services, flexible repayment plans, and seamless digital experiences will continue to rise, forcing the industry to prioritise innovation.
“The pressure to modernise will not be limited to neo-banks. Traditional financial institutions, still reliant on legacy systems, face an increasingly important dilemma. Modernising outdated legacy technology is no longer optional, it is essential for survival. Banks that fail to act risk losing relevance in the face of growing competition.
“The need to upgrade and modernise the current application is key for both financial institutions, as well as buyers. According to Ohpen’s data, 38% of homeowning 24–35-year-olds wished they had chosen to rent for longer instead of going through the mortgage application process – a damning sign that rapid change is needed.”
Technology’s critical role:
“In addition to evolving mortgage products, technological advancements are expected to reshape the sector. Artificial intelligence will play a critical role in streamlining underwriting processes, enabling lenders to assess unconventional income sources with greater accuracy. This is particularly important as the gig economy continues to expand, and traditional credit evaluation methods prove inadequate for these new employment models.
“Cloud-native technology will also become a cornerstone of the industry’s transformation. By shedding the constraints of legacy systems, financial institutions will unlock greater scalability, efficiency, and adaptability. Early adopters of modern cloud platforms are already demonstrating the competitive advantages of these technologies, and their success will set a clear benchmark for others to follow. Generative AI is poised to revolutionise not just back-office operations but also customer-facing services, offering faster, more efficient solutions that enhance the overall customer experience.
The future of financial services in 2025:
“As 2025 unfolds, the industry will reach a tipping point. The cost of clinging to outdated systems will become increasingly untenable, while the benefits of modernisation will be evident in the successes of forward-thinking organisations. Sustainability will also rise in importance, with green mortgages and eco-conscious products gaining traction among environmentally aware consumers, particularly younger demographics like Gen Z.
“Ultimately, 2025 will be defined by adaptability and innovation. The financial institutions that thrive will be those that embrace change, leverage technology, and prioritise the needs of an evolving consumer base. The winners will not only respond to current trends but anticipate future demands, ensuring they remain competitive in a rapidly shifting landscape.”
