Case studies

Tembo and GoCardless harness open banking to help homebuyers

22 May 2025

Buying a property in the UK can be complex and time-consuming, requiring lots of paperwork at different stages of the purchase before buyers can pick up the keys to their new home. 

A recent survey from Market Financial revealed that two-thirds of respondents who bought a UK property last year or who are currently purchasing one, said the process was too slow and complicated, while 65% felt that getting finance to purchase their property was stressful. 

However, open banking and open finance solutions used by digital savings and mortgage platform Tembo Money, are helping in several important ways. 

Greater choice of mortgage providers and products 

Tembo’s mortgage comparison service searches more than 100 lenders and 25 schemes to match buyers to the best mortgage deal. The service is not tied to any provider, and works with specialist lenders which cater to individuals with more complex financial needs, such as the self-employed. 

Cutting paperwork speeds up lending decisions 

The amount of financial information required to demonstrate proof of income, and ability to repay, is often cited as one of the biggest hurdles to securing mortgage lending quickly.  

The paper-based application process can take between four to six ​​weeks, and involve collating months’ worth of pay slips, bank statements, and bills, as well as proof of identity and ​​address.  

However, an increasing number of banks, building societies, and mortgage brokers now use open banking connections to validate a borrower’s income, eliminating the need to provide much of this ​​paperwork.   

Tembo uses open banking assessments as part of its Know Your Customer (KYC) checks, supporting faster decision-making on borrowing. Most customers receive a (‘decision in principle’) almost instantly, followed up by a formal offer around 10 days later.  

All new customers have to authorise an open banking connection. Successfully making an initial £1 payment simultaneously verifies their identity and confirms their bank details have been entered correctly.” 

Dave Campbell, Operations Lead, Tembo

Personal and online service streamlines applications 

The Tembo journey starts online, then matches borrowers with a dedicated adviser to help them find a personalised deal. Advisers also explore options such as the Lifetime ISA (LISA) or other ways to boost savings.  

Unique features to help maximise savings 

Tembo’s tagline is ‘Making home happen’, and the firm aims to help homebuyers make the most of their savings and offers innovative ways to do this through its open banking-based savings app. 

Tembo’s Cash Lifetime ISA is one of the platform’s most popular features. Customers can save up to £4,000 each tax year in its LISA, and boost their first home deposit with a 25% government bonus of up to £1,000 each tax year. They can also quickly and easily top up their Tembo LISA with one-off open banking payments or recurring Direct Debits, all via the Tembo app. 
 
It also includes a Gift Time feature, which allows friends and family to contribute to savers’ LISAs quickly and securely via an open banking link, without having to enter their bank details. This is particularly helpful for younger savers, who may have a parent or grandparent who wants to contribute towards their property purchase.  

Dave added: “Customers love Gift Time, and we’ve even seen people put it on their wedding invites to collect gifts that way.”  

‘Instant Bank Pay’ helps buyers build deposits 

Tembo started working with bank payment company GoCardless in 2021, enabling customers to quickly top-up their Tembo Lifetime ISA and other savings accounts with recurring Direct Debits. Tembo soon added GoCardless’ open banking-powered payment feature, Instant Bank Pay, for one-off payments.  

Since introducing Instant Bank Pay, Tembo:  

  • has seen Instant Bank Pay deposits increase 400% year-on-year for the 2023-2024 tax year.
  • was able to extend its 2024 end-of-year tax deadline by six hours, allowing it to collect an extra £1 million, and unlock £250,000 in government bonuses for customers. Tembo customers have praised the ability to make deposits ‘pretty much right up to the [tax year] deadline’
  • has seen customer satisfaction scores rise from 84% to 98% over the past 12 months.

What the customers say

Customer Josh Kendrick points out that the platform offers a flexible way to save: “Tembo is easy. I get paid every month and I don’t worry about it – [my savings] just go straight out on payday and into the ISA.” He also praises the fact that Tembo can help customers meet the end-of-year tax deadline.

This use case exemplifies how open banking can help everyday people during the cost-of-living crisis. When consumers are hard-pressed to save, it’s vital to offer solutions that fit their financial situation, and our collaboration with Tembo underscores why open banking is coming into its own at exactly the right time.”      

Pat Phelan, Chief Commercial Officer, GoCardless

Financial inclusion

The use of open banking data as part of affordability assessments can also expand access to borrowing for individuals who may be excluded from traditional mortgage lending, such as people with adverse credit history or the self-employed.

Supporting the UK housing market

Tembo and GoCardless are just one innovative example of how open banking and open finance are speeding up mortgage borrowing, reducing the time it takes to finalise house ​​​​purchases. This, in turn, can benefit buyers, lenders, and property professionals, helping to boost the UK housing ​​market and the broader economy. This year alone, aspiring homeowners are set to contribute £74.1bn to the housing market – including £3.1bn on related costs such as furnishings and DIY. 

Video credit: Tembo Money and GoCardless