Lightico » Auto Finance
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The blog features articles on car finance, auto industries, resources, lending and credit, compliance and more. Lightico digitally transforms your business with industry leading Customer Experience enterprise software platform.
Lightico » Auto Finance
3w ago
The amount of information available to organizations today can be overwhelming. Businesses receive a lot of data. This data includes loan applications, insurance documents, emails, reports, invoices, supporting documentation and contracts.
Data needs to be processed quickly and accurately, especially when it is ingested by paper or digital documents. This is where Intelligent Document Processing (IDP) comes in.
IDP is a technology that uses artificial intelligence and machine learning to automate the extraction of data from documents. IDP uses advanced algorithms to analyze and extract importa ..read more
Lightico » Auto Finance
3w ago
Lenders are taking a more cautious approach and tightening their lending criteria to mitigate risks associated with lending to today’s financially stressed borrowers. Additionally, government authorities and regulatory bodies may intensify their scrutiny of lending. The auto loan application and underwriting process stand as pivotal stages where caution and regulation are highest.
The problem is, many lenders are still using traditional manual methods (“stare and compare” analysts anybody?) of processing loan applications. This often result in inefficiencies, delays, and increased risk of erro ..read more
Lightico » Auto Finance
1M ago
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
Lightico » Auto Finance
3M ago
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
Lightico » Auto Finance
5M ago
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
Payment Due Date Change Requests and Other Auto Finance Lender Challenges During Economic Recessions
Lightico » Auto Finance
6M ago
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
Lightico » Auto Finance
8M ago
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
Lightico » Auto Finance
10M ago
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
Lightico » Auto Finance
1y ago
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
Lightico » Auto Finance
1y ago
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