How Can Lenders Adapt to Rising Regulatory Pressures and Meet Customer Expectations in 2025?

Sam Goodacre and Kieron Meakin from Lenvi, along with Matthew Wheaton from Acquired.com, dive into the main issues lenders will face in 2025. 

Two key points come up: the pressure from regulations and what customers now expect. There’s a big question mark around the Supreme Court’s upcoming decision on discretionary commission arrangements (DCAs), especially in motor finance. People are worried it might have a huge impact, similar to what happened with PPI claims, affecting not just the companies involved but the entire lending industry.

They also talk about the general regulatory scene, focusing on the FCA’s push for consumer duty and the government’s plans for deregulation. Lenders need to provide fair value, help vulnerable customers, and brace themselves for tougher supervision. Adjusting to these changes isn’t easy, especially in a field where profit margins are slim and costs are going up.

On the customer side, expectations have changed a lot. In a world where services are available 24/7 online, people want quick and easy experiences on their phones—and they don’t like any hiccups. This creates a challenge for lenders trying to keep up, especially with AI and tech setting new standards. But going fully digital isn’t the answer for everyone; many still prefer talking to a real person when things get complicated. Lenders need to find a balance between using technology and providing human support.

Looking to the future, there’s some hope. New fintech companies are shaking things up with their speed and flexibility, while traditional lenders are updating their technology to stay in the game. The focus is shifting from just meeting rules to working more efficiently, blending new tech with existing systems, and improving overall service delivery. Being efficient is becoming a competitive edge.

In summary, the key point they make is that lenders who can adapt quickly, personalize customer experiences, and run their operations smoothly will come out on top. With more regulations, higher customer expectations, and fierce competition, offering value at every step is more important than ever.