There’s a digital revolution happening in the leasing market. The rapid development of digital services to support leasing providers is changing how established players and challengers react to, and interact with, their customers. One central challenge facing the sector is replacing legacy leasing systems and transforming operations. Andrew Ingram, global head of products at leading leasing software company Alfa, explains, “A lot of the systems we’re going into replace don’t support real time APIs, and they can’t make configuration changes.
“If you’re offering digital products, it’s about understanding why the customer does certain things and what they want. Why are they requesting a copy of their statement? Why are they asking for a payment holiday? Ask yourself are you solving the symptom rather than the root problem?”
Alfa provides technology solutions to major leasing companies, including the large high-street banks and other specialist leasing firms and lenders. It works primarily in general asset finance for corporates and automotive leasing for companies and individuals. Its platforms transform how leasing companies operate, speeding up policy implementation and decision making, including approvals, while maintaining strong compliance. It helps leasing providers develop a better understanding of their customers.
Alfa’s platform allows its clients to react quickly. It can help even if a client has launched a new product that afternoon, says Ingram. “We’ve got the tools and techniques there that allow you to be able to adapt rather than to change your software or anything else.”
As with most sectors undergoing this level of digital disruption, being agile and nimble is essential and it’s something Alfa has baked into its startup-like, test and learn, philosophy. “By being more ‘plug and play’, you’re able to focus your effort on understanding the customer and building what the customer wants, rather than spending all of your time working out how you build a product.”
Consumer attitudes towards leasing products and the services they provide is also shifting. “A trend we’ve seen is people want to have access to the system and they want to have that engine to run their business, but they don’t care about how that’s run. They want the people who understand that software and want to be able to run it and maintain it for them.”
The ability to adjust leasing products more quickly in response to market developments is now essential. Businesses no longer want an off the shelf product, but a bespoke service to match that their business’ operation. “We’ve built up a toolkit that allows us to build an external application that matches the customer journey. It’s not just about us saying, ‘Here’s a bit of software that you can give to your customers, it will make them happy because it’s digital’. It’s not just vanilla. It’s about how you tailor that to how you want to your business.”
Not that taking a business through such a digital transformation is easy. Zoe Chambers, digital product owner at Alfa, says, “You have to understand that often it’s the first time a lot of the people we work with are doing this kind of transformation. You’re leading them through something that can be big and scary, but we give them comfort that we’ve done it many times before.”
Alfa recently released its second white paper on AI in the asset finance industry, and machine learning in particular. It examines how auto and equipment finance providers can leverage machine learning and AI techniques to enhance efficiency and improve customer service.
Machine learning is something the business is considering incorporating, but is being cautious. “One of the things we’ve been quite careful with over the years is to not jump on a bandwagon and get found out to be just talking about buzzwords. But we are seeing a bit more maturity in the data. There is a pretty clear opportunity to start looking at machine learning and how to utilise it, but we’ve got a lot of work to do.”
Ingram agrees that this approach is best. “We’re going through that same kind of journey that a lot of our customers are going through to be innovative. In digital transformation we practice what we preach.”