UK start-up Perenna has been granted an unrestricted banking license by the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA).
This approval allows Perenna to introduce long-term fixed-rate mortgage products in the UK, aiming to provide an alternative to variable and short-term fixed-rate mortgages.
The move comes in response to concerns that rising interest rates could impact over one million mortgage payers in the UK by 2026.
Perenna’s license enables them to offer mortgages with fixed rates of up to 30 years and an early repayment charge (ERC) period of five years, financed through covered bonds.
The company plans to launch in the UK later this year with the goal of bringing structural change to the country’s mortgage market by offering improved affordability and certainty of monthly payments. – Fintech Futures