For too long, car finance has been compromised by inefficient and manual processes. The good news is that change is in the air: with a glove-box full of powerful algorithms and new technologies, things are about to accelerate, writes Jonny Clayton, chief executive at Oodle Car Finance.

For years, people have had little choice but to have a face-to-face car buying experience, meaning customers made the final decision to buy from a dealership.

However, while dealers remain in a strong position at the end of the buying process, times are changing. Buyers are now much more informed about cars than in the past – they often arrive having already carried out all their research online, and will have pre-checked their affordability.

With so much choice available, including online finance options, car subscriptions schemes, personal contract hire and ride-hailing apps to name but a few, dealers now have a lot to compete with.

Analysts are predicting that nearly all dealers will have online purchasing services up and running in the next two years, making it easier to secure finance. It is critical, therefore, that online finance platforms evolve so they become slick and intuitive for dealers to get the best use of.


Thankfully, technology changes have already started making an impact in the car finance space, but here are my predictions of what to expect more of in the next 12 months:

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  • Finance applications will become increasingly personalised, taking into account individual circumstances and vehicle information and enabling customers to get the best possible rates;
  • Applications will require less information – only what is necessary for approval. This will significantly reduce paperwork, but will also provide better data protection and ensure that compliance processes are followed;
  • More loans will be agreed in real time, enabling customers to secure funds in minutes rather than hours, and sometimes even days;
  • Through online platforms, dealers will be able to support new transactional propositions, bringing the online retail experience and outcomes up to date and in line with other verticals. Customers will, therefore, feel empowered to buy any car from any trusted dealer network;
  • More payment options will appear to support customers who want the freedom to change ownership of their cars more frequently. Dealers will be equipped to provide better finance and rental options and flexible contracts to fill the gap between sharing and full ownership, achieved by having a better understanding of their customers;
  • As such, there will be new online checkout tools emerging;
  • Customers will have the option of ordering a home delivery, complete with appropriate returns policies to remove the ‘sight unseen’ purchase risk; and
  • Improvements will be made to photo and video quality and condition reports, enabling easier-to-navigate car discovery and better comparison of models across budgets.

It is all about developing a seamless online journey, not disrupted by an offline, manual process, and helping the customer to build confidence in their purchase by giving them plenty of good options.

Outside improvements in the online process, we are working on making the cross-platform experience more consistent, so that irrespective of what channel or device a customer uses, they will be able to start their journey on one and finish on another. Making the journey smoother will enable us to break down the traditional barriers of how customers think about applying for finance.

Opportunities to Engage

Dealers have been lucky to date because many buyers still want to test drive a car so they venture into dealerships; however, there is no room for complacency.

Beyond improvements in finance, technology will soon be providing virtual and augmented reality tools and test drives that will make car buying more experiential. It will also make it more interactive for a family – meaning opportunities to engage outside the buying process. It will enable dealers to advertise vehicles beyond photos, videos and vehicle detail pages without huge investment costs.

The reality is that car buying now starts online, and this trend is set to continue. Dealers must shake up their digital strategies and work with finance houses to ensure they are present at the beginning of the buying chain, not just the end.

The present and future opportunities and challenges in the motor finance sector are very real, but it must move forward to stay relevant to customers. Time to step it up a gear – or three!

by Jonny Clayton