Building trust at scale: Why endorsement, not just excellence, will help define the future of later life lending – Soraya
Following the hugely successful Leaders Symposium held by the Equity Release Council last month, it is obvious to see that the question facing the later life lending sector is no longer if housing wealth will become a mainstream component of retirement planning – it is when.
With people living significantly longer, a growing population, the decline of defined benefit pensions, and increasingly varied consumer needs, for many people, their home will be their single most valuable asset.
It seems incredible to say this when completions have decreased almost by a third over recent years, but there still remains pent-up demand, and as and when the world stabilises, the industry must be ready.
I was proud to contribute on the day, where senior figures from across the market – and across the globe – came together to explore what responsible growth looks like in practice. The session that I was part of, ‘Building Trust at Scale: The Future of Later Life Lending‘, tackled one of the most important questions in financial services today: how do we scale a market while keeping consumer trust and strong outcomes at its absolute centre?
Trust is essential to later life planning
The Financial Conduct Authority’s (FCA’s) Nikhil Rathi recently observed that retirement is increasingly a “balance sheet issue” rather than simply a pensions issue.
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That framing resonates deeply. Consumers are making interconnected decisions across pensions, housing wealth and savings – decisions of enormous complexity and consequence. The later life lending sector has a responsibility to be genuinely fit for purpose as part of that wider picture, and to earn the trust of other parts of the financial services ecosystem so that truly holistic planning becomes the norm rather than the exception.
The honest truth, however, is that widespread consumer trust is not yet there. It remains anchored with the sector’s historical challenges, and very often, the first conversation an adviser has with a new client involves confronting that past.
Only after unpacking decades-old perceptions – and explaining how modern products and protections actually work – do most people leave an initial meeting feeling genuinely informed and reassured. That is a significant barrier to mainstream adoption, and it must be addressed head-on.
External endorsement matters
For me, the single most important catalyst for change is not something the industry can deliver alone. It is substantive endorsement – not merely acknowledgement – from the FCA and government.
There is a meaningful difference between the two. Acknowledgement recognises that the sector exists; endorsement signals that it is a safe, credible and valuable solution for consumers navigating retirement.
That endorsement would be transformational in shifting public perception and accelerating the cross-sector collaboration that holistic later life planning demands.
Innovation also has a vital role. Advisers need sourcing systems that present a complete picture of solutions at their fingertips. Products must continue to evolve – including retirement interest-only (RIO) and hybrid offerings – to meet changing borrower profiles and attract a younger audience. And the end-to-end consumer journey must become more seamless, because experience shapes trust as much as outcomes do.
The Equity Release Council is doing exceptional work raising standards, supporting advisers in handling vulnerability, and lobbying for greater recognition from regulators and government. That work must continue and intensify.
But, when the FCA, through Emad Aladhal, lays down the gauntlet – as it did last month to ask our industry to step up – alongside this, we need the FCA to genuinely endorse later life lending as part of mainstream retirement planning.
