One of the most notable developments is the continued rise in credit demand. Credit inquiries are steadily increasing, driven not by consumer confidence but by necessity. With the cost of living remaining high and interest rates elevated, more people are turning to credit products to manage everyday expenses. January 2025 alone saw the highest jump in credit card borrowing since late 2023, and this trend is expected to continue into 2026.

For lenders, this creates a more complex risk environment, with a growing number of applicants whose financial resilience may not be immediately clear through traditional assessments alone.

Buy now, pay later (BNPL) is undergoing a fundamental shift. From July 2026, BNPL providers will fall under full Financial Conduct Authority regulation, requiring authorisation, proportionate creditworthiness assessments and stronger governance across all agreements.

As BNPL moves into more heavily regulated territory, the bar for visibility and decisioning will rise. Lenders will need risk models that are backed by robust data sources to support compliance, protect consumers and minimise defaults.

Financial inclusion is also taking centre stage in 2026. Millions of UK adults remain financially underserved or excluded, despite often demonstrating stable financial behaviour. Traditional credit scoring methods can struggle to reflect this, particularly for those with thin or non existent credit files.

The growing use of alternative data is helping lenders better assess overlooked borrowers, enabling fairer affordability decisions while strengthening portfolio performance.

Rental data is becoming an increasingly visible component of consumer credit assessment. Rent payments can provide valuable insight into financial reliability, yet have historically sat outside traditional credit reporting.

By incorporating rental data, lenders can fill key visibility gaps and gain a more complete understanding of applicants whose strongest indicators of financial responsibility exist outside mainstream credit products.

UK motor finance lenders are preparing for regulatory-led remediation to millions of consumers over unfair car loan practices occurring over the last twenty years. This will create unprecedented operational, outreach and fraud-related challenges. As remediation planning accelerates, affected firms need to prepare data, governance and resourcing measures, and carefully consider what can be handled in-house and where third-party support is needed. Looking further ahead, firms will also need to consider how they can grow business, for example how improving data capabilities can help untap new lending opportunities and support better risk decisioning.

Taken together, these trends point to a clear conclusion. In 2026, lenders that succeed will be those that adopt flexible, multi layered data strategies. Combining traditional credit information with richer datasets enables better decisions, stronger compliance and more responsible growth in a rapidly evolving credit environment.

This article is taken from LexisNexis® Risk Solutions’ Top Five Credit Risk Assessment Trends report. Download the full report here.