By Rowan Clayton, Chief Product Officer at Finova
Artificial Intelligence has moved well beyond the hype in financial services, but for many lenders, its full potential is still just out of reach. Behind the scenes, AI is already transforming how lenders work, from document checks and fraud detection to affordability assessments and portfolio monitoring.
Yet despite these advances, progress across the mortgage industry remains uneven. Legacy systems, regulatory caution, and misconceptions around automation continue to slow adoption. As a result, many lenders risk missing out on the biggest opportunities AI has to offer.
AI that assists, not replaces
The greatest potential for lenders lies in assistive AI — technology that augments human expertise rather than replacing it. Across the market, we’re seeing how AI-driven tools are already helping lenders work more efficiently.
Intelligent affordability models can flag potential risks earlier in the journey, while advanced fraud and AML systems are reducing false positives and streamlining compliance.
These targeted applications don’t just save time. They make decisions fairer, more consistent, and easier to explain whilst improving both transparency and trust. For borrowers, that means quicker approvals and a smoother experience. For underwriting teams, it means less manual effort and more focus on high-value work.
Learning from other sectors
Mortgage lending has always taken a careful approach to new technology, and for good reason. The complexity of products, combined with regulatory scrutiny, means innovation must be deliberate and well-controlled.
But there’s a lot to learn from other parts of financial services that have already made AI work in practice. Unsecured lenders have shown how machine learning models can improve credit scoring accuracy, while Open Banking has demonstrated how securely sharing data can unlock richer customer insights.
By applying these lessons in targeted, low-risk areas such as document verification or eligibility checks, lenders can take meaningful first steps towards responsible AI adoption.
Modern infrastructure makes all the difference
AI delivers the most value when it runs on modern, flexible infrastructure. Many lenders are still hindered by legacy systems, which make it challenging to integrate new technologies and respond quickly to market changes. Moving to cloud-native mortgage platforms allows lenders to implement AI extensively. These systems are built for agility, allowing seamless integrations with third-party providers and quicker updates to stay aligned with evolving FCA regulations.
When combined with automation and cloud-based workflows, AI not only accelerates processes. t also improves accuracy, resilience, and the customer experience, while minimising operational risk.
A balanced approach to innovation
True innovation in lending isn’t about disruption for the sake of it. The most forward-thinking lenders are those who combine new technology with sound operational discipline. Automating repetitive tasks like document analysis and income verification enables advisers to focus on what truly matters: building relationships and guiding customers through significant financial decisions. It’s not people versus technology; its people empowered by technology.
By adopting a measured, data-led approach, lenders can demonstrate control, build confidence with regulators, and achieve meaningful efficiency gains without compromising on quality or compliance.
Looking ahead
The evolution of AI in lending won’t happen overnight. It will be shaped by lenders who take steady, deliberate steps to test, learn, and scale responsibly.
At Finova, we’re already helping lenders embed AI into core workflows, from origination to servicing, enabling faster and fairer outcomes for customers. The long-term winners will be those who see AI not as a passing trend, but as a practical enabler of better lending, one that helps people make smarter, faster, and more confident financial decisions.
