The Financial Conduct Authority has set out its latest vision for open finance, with early work expected to focus on improving access to credit for SMEs and exploring how shared financial data could support mortgage borrowing and management.

In a paper published on Tuesday, the regulator said open finance could allow consumers and businesses to share a wider range of financial data securely with authorised firms, building on the model established by open banking.

The FCA said this could help providers develop a fuller picture of a customer’s financial position across areas including mortgages, savings, investments and pensions. In turn, that could support more tailored products, sharper pricing and faster decision-making, while also strengthening fraud prevention.

For the property and mortgage market, the regulator has identified home finance as one of the areas it wants to examine more closely. Alongside work on SME lending, the FCA said it would explore how open finance could help consumers manage mortgages and improve access to them.

That is likely to be of particular interest to lenders and brokers dealing with applicants whose income patterns do not sit neatly within traditional underwriting models, as well as borrowers looking for more responsive support over the life of a loan.

David Geale, executive director of payments and digital finance at the FCA, said: “Open finance has the potential to transform how people interact with financial services.

“By giving consumers and businesses more control over their own financial data, we can help them access credit, secure better deals and receive more customised support – while fuelling innovation, competition and supporting economic growth.”

The FCA said it would work with industry, consumer groups and other regulators during 2026 to identify practical use cases through its Smart Data Accelerator and the PRISM taskforce. It is also planning to work with HM Treasury on options for a regulatory framework by the end of 2027.

While the full framework remains some way off, the regulator said firms may be able to bring open finance products to market earlier where data access and permissions are already in place.

Adam Jackson, chief strategy officer at Innovate Finance, said: “Just as open banking has sparked the growth of many UK fintechs, so open finance can power a new wave of innovation. By unlocking high quality data in a way that secures consumer trust, open finance can be a foundation for widespread adoption of agentic AI.

“We support collaboration between industry and the FCA to deliver the roadmap at pace, enabling agreement on priority use cases and datasets, and appropriate regulatory action to open these up to competition and innovation.”

MORTGAGE MARKET IMPLICATIONS

Industry reaction suggested the mortgage market could become one of the most significant testing grounds for open finance, particularly if lenders can use richer and more up-to-date data to assess affordability.

Damien Burke, head of regulatory practice at Broadstone, said: “Open finance has the potential to transform how consumers access financial services and it is energising to see the FCA accelerating these plans.

“Leveraging this technology can create a market that enables institutions to have a clearer view of the consumers they support and drive economic growth via further innovation in the UK’s dynamic financial services sector.

“By enabling lenders to access a more complete, real-time view of a borrower’s financial position – including income patterns, spending behaviour and existing liabilities – affordability assessments can become far more accurate.

“This should help move the market away from blunt, one-size-fits-all criteria towards more tailored lending decisions that reflect how people actually earn and manage money today, particularly those with non-traditional or variable incomes.

“For consumers, this could translate into more realistic borrowing limits and better-matched products, reducing the risk of both overextension and unnecessary rejection. It also creates an opportunity for lenders to design more flexible solutions – whether that’s adjusting repayment structures, offering more responsive stress testing or identifying earlier interventions for those at risk of financial strain.

“The success of open finance in the mortgage market will depend on how effectively lenders embed these insights into underwriting processes while maintaining robust risk controls. If implemented well, it could support a more inclusive lending environment that balances innovation with responsible affordability.”

Kate Pender, chief executive of Fair4All Finance, also argued that wider use of live financial data could improve access to credit for people whose circumstances are not well reflected by conventional credit scoring.

Pender said: “Open finance presents an incredible opportunity to break down barriers to accessing credit, allowing more people to get access to the products they need.

“We have seen significant use of open banking within the credit union and CDFI markets, where they increasingly look at people on the whole, moving away from the singular view of a credit score.

“Evidence from lender Salad Money on their use of open banking has already shown that it is more inclusive and allows them to better serve customers in a more holistic way. This means that lenders can take better informed decisions on whether to lend to someone, increasing access and reducing friction.

“Open finance and the use of real time data can give lenders a more accurate picture of someone’s financial position, rather than relying on a credit score that may be dated, damaged or low.

“It is important that we harness the next evolution of open finance and tie it directly to financial inclusion by improving understanding of people’s financial position and their access to appropriate and increasingly personalised products.

“As we design the future of Open Finance, as an industry we need to learn the lessons from the implementation of Open Banking, ensuring that it is engrained in businesses from the start and that uptake with customers is high so more people benefit.

“To make the most of Open Banking as an industry we need to invest more in adopting the opportunities that are already available. It is also important that we bring the public on board now so that they can see the benefits ahead of Open Finance taking off.

“Going forward it is crucial that we review the 90-dat rule for re-authentication, which causes friction for consumers and increases drop-off, in order to bring the UK in line with international markets.”

A WELCOME STEP FORWARD

Maria Harris, chair of the Open Property Data Association, said: “The FCA’s open finance roadmap is an important and welcome step forward. Property and finance are two sides of the same coin, and for the homebuying process to truly improve, the data that underpins both must be compatible, consistent, and connected. We are actively collaborating with the FCA, Open Banking Ltd and the wider Smart Data Council to ensure our smart data schemes can operate together.

“We’re particularly pleased to see a commitment to a policy and technical sprint this year. Creating a framework that allows property, mortgage, and financial data to flow securely and seamlessly between systems is essential if we want faster transactions, fewer fall throughs, and greater transparency. OPDA is already contributing to this work through the FCA’s PRISM taskforce, helping to assess the impact of the priority use cases and ensure the foundations are right.

“Open finance has the potential to transform the homebuying journey – from faster mortgage approvals to more accurate affordability and smoother completions. But that can only happen if the underlying data is standardised, accessible, and trusted. This roadmap signals real momentum, and we’re pleased to be working with industry and regulators to deliver a better home buying and selling process, helping to drive economic growth and a more sustainable property market.”

The FCA’s latest statement does not set out detailed rules, but it gives a clearer indication of where the regulator believes open finance could have the most immediate value. For mortgage firms, that points to a longer-term shift towards underwriting and customer support models shaped by broader, real-time financial information rather than more static snapshots.