Stocking solution provider NextGear Capital will launch a standalone stocking product for dealers to acknowledge Financial Conduct Authority (FCA) rules.
Financial benefit to the dealer from a reciprocal stock funding support programme would be covered by FCA requirements on remuneration, but could be difficult to calculate, said Nextgear.
Go deeper with GlobalData
Access deeper industry intelligence
Experience unmatched clarity with a single platform that combines unique data, AI, and human expertise.
As a result of these regulations, any linkage between used car stocking and retail finance support could be made unrealistic for dealers.
For this purpose, NextGear is planning to launch a standalone stock funding option to the franchised dealer market.
David Mercer, managing director of NextGear Capital, said: "The traditional F & I dealer model is undergoing a major change to create a more transparent and customer centric experience. In part this is driven by regulation but also through a more informed consumer, wanting to take a more forensic view of their vehicle financial arrangements.
"Stock funding and any reciprocal earning arrangements must be recognised by dealers as part of this new transparent era. By providing a stand-alone stock funding option, dealers can ‘unbundle’ their retail finance arrangements and benefit from a new level of negotiation freedom, whilst embracing the spirit and practice of FCA regulation."
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalDataThe new product is expected to launch in the first quarter of 2015.
