The UK car finance industry is currently facing a significant challenge as the Financial Conduct Authority (FCA) investigates past lending practices. The investigation centers on the use of “discretionary commission arrangements,” a practice where sales personnel received higher commissions for car loans with higher interest rates. While banned in 2021, the FCA is reviewing loans dating back to 2007, raising concerns for banks and potentially impacting millions of consumers. A Closer Look at Discretionary Commission Arrangements and Potential Mis-selling Prior to the 2021 ban, car dealerships ..read more

The world of Auto Finance is marked by a paradox – while the industry fuels the consumers auto dreams, the behind-the-scenes reality is often obscured by mountains of paperwork. From loan applications, support income documents, welcome letters, to vehicle titles, the sheer volume of documents is staggering. It’s in this labyrinth of paperwork that the Auto Finance sector encounters its most significant challenges — a terrain where efficiency, accuracy, and compliance are not just desirable but imperative. The need for innovation becomes evident in the face of these challenges. Enter Intelligen ..read more

The world of customer service and call centers is undergoing a profound transformation, especially in the realm of Interactive Voice Response (IVR) systems. Once considered a standard tool for basic information retrieval, IVR systems are now tasked with meeting the increasingly complex needs and expectations of customers, particularly in sectors like banking and financial services. In times of recession, optimizing the efficiency of loan servicing, particularly around payment due date changes via IVR, should be top of mind for any lender. Traditional IVR setups, with their menu-driven structur ..read more

The impact of the recession is reverberating through the lending sector, significantly influencing how auto lenders manage deferments or payment due date changes together with the broader dynamics of their operations. During a recession, borrowers frequently grapple with increased financial strain, stemming from job loss, reduced income, and heightened living expenses. As a result, they often face challenges in meeting their auto loan obligations, creating a surge in requests for due date changes, or even deferment of payments all together. This elevated risk of default necessitates that lende ..read more

Digital transformation has become more than just a buzzword in the auto finance industry. It has become a necessity for survival and success and captive auto lenders lead the way in embracing technology to enhance their operations. However, there is still a significant gap between the digitization efforts at the top of the funnel and the lingering manual processes that persist at the bottom of the funnel in digital transformation projects. This divide, characterized by hundreds of non-digitized and non-user-friendly complex digital processes, poses various challenges for captive auto lenders ..read more

Collections departments in the realm of consumer lending are crucial for managing delinquencies and ensuring customer engagement. While traditionally seen as a reactive measure during economic downturns, today’s competitive market demands a shift in mindset. Collections should now be viewed as a strategic tool for driving growth and fostering lasting customer relationships. By leveraging appropriate technology, lenders can streamline customer-facing collections processes to cater to the changing borrower persona. Regardless of the economic cycle, collections have the potential to extend beyond ..read more

The Importance of Innovation in Banking As banking continues to evolve, innovation is critical to staying relevant and competitive in the market. Unfortunately, many financial institutions are still hesitant to embrace new technologies and ideas, leading to a dangerous “do-nothing” attitude that can have severe consequences for the banking industry as a whole Banks have always been at the forefront of technological innovation, but the pace of change in recent years has been unprecedented. With the rise of fintechs, changing customer expectations, and new regulatory requirements and a volatile ..read more

Stipulation (Stip) Collection is Killing Your Auto Loan Business.  As an auto lender, you’re always looking for ways to improve efficiencies, increase loan volume, and boost profitability. One area where many lenders struggle is in the collection of documents and stipulations. Manual document and stip collection is a time-consuming and often frustrating process for everyone involved. But there is a better way. By digitizing document collection, you can improve efficiencies, reduce errors, and win more business from dealers.   The Problem with Manual Document and Stip Collection The t ..read more

Let’s face it: managing customer delinquencies, loan extension requests, and other modifications can be unpleasant and time-consuming. Chasing customers for supporting documents and eSignatures and fielding calls — especially about sensitive financial issues — can burden employees and their managers. With Lightico’s Digital Completion platform, auto lenders can streamline and digitize loan servicing journeys. The platform allows lenders to process more borrowers in less time. Read on to learn how. Challenge: Inefficiencies and Complex Paperwork Lenders today are plagued by inefficiencies and s ..read more

Auto loan originations tends to be a cumbersome, messy process. Lenders find themselves chasing dealers or borrowers for stips and forms, resulting in wasted time and overhead costs. With Lightico’s Digital Completion platform, auto lenders can quickly and seamlessly complete the customer-facing originations process. Challenge: Slow Loan Originations Processes Slow loan originations processes are a pain — and costly. Lenders waste time chasing borrowers and dealer for missing documents and signatures. Most consumers do not carry proofs and stipulated documents with them, which delays the time ..read more