What are the opportunities for finance providers in dealer sales of
used cars on the internet? According to the Motors Digital division
of Associated Newspapers, which operates Motors.co.uk, they are
quite substantial. The site features over 100,000 cars from dealers
around the UK.
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Adrian Black, business development director of Motors Digital,
stressed the motor finance potential in this sector when addressing
the FLA Motor Finance Convention last month: “We see a number of
finance related opportunities. We have over 1,400 independent
dealer clients interfacing with our system through their Auto
Exposure web sites. They tend to have very poor levels of finance
penetration and they are largely reliant on a customer base
representing sub-prime credit propositions. So we have partnered
with Jigsaw Finance to offer integrated finance in our web sites
for independent dealers and ensure that we could offer good
sub-prime coverage.”
Finance terms from Jigsaw are embedded in the dealer web sites, he
explained, and the system is popular with dealers because of the
increased penetration and profit it offers them. “Some of them
convert customers to other finance providers with whom they have
in-house partnerships. We eventually charge them for using the
system, but they like the finance business that is generated as a
result.
“Other dealers write finance deals with Jigsaw through us. They get
free use of the software and reasonable commissions. Jigsaw
increases its own network and writes more business, while we get
satisfied dealer clients and commission too,” Black
explained.
Black acknowledged the potential for fraud in online deals. “We
could not presently recommend a payment method guaranteed to be
safe for both buyers and sellers. There is clearly a need for one
and we want to create one, ideally to include finance settlement,”
he said.
