The coronavirus pandemic has offered a stark reminder that business leaders should not try to predict disruption. For the leasing and asset finance market, a better technique is to build agility and innovation into the core of the business. That way, when the next black swan event strikes, it’s easy to adapt.
But most businesses have historically not been good at innovation. A recent McKinsey survey found that while 84% of respondents agreed that innovation is important to their growth strategy, only 6% were satisfied with their innovation performance.
One business that has always stood against this trend is NETSOL Technologies, a producer of frontend and backend systems for the asset finance and leasing providers. The company was founded in a spirit of constant or “always-on innovation,” and it remains a company-wide ideal much like the business practice of continuous improvement, with employees across the organisation at all levels contributing to product innovation and service improvement. Always-on innovation is the reason NETSOL was able to win major new contracts in markets ranging from the UK and Europe to China and the Americas throughout 2020.
All you need is the right technology
The leasing and asset finance market has seen several significant disruptions over the past five years, including major advances in technology and the current Covid-19 pandemic. But, despite such a challenging environment, NETSOL continues to thrive, largely thanks to the innovative way it supports clients helping their customers cope with these disruptions.
Chris Tobey, Global Sales Director, Wholesale Finance Solutions at NETSOL, is well aware of the impact of innovation on the business. In 2020, he watched as subscription revenues emerged as one of the biggest growth segments for the business. Software as a Service (SaaS) and the Otoz Mobility Innovation Lab have exceeded the firm’s expectations. He explains: “Our customers have been through a period of rapid digitalisation. As a result of the pandemic, cloud-based systems are more in demand than ever and that’s translated into subscription growth. It’s been absolutely imperative that we’re able to adapt to meet the changing needs of our customers, both new and old.”
NETSOL has developed several SaaS products aimed at the leasing and asset finance sector. NFS Ascent is an automated programme for finance and leasing operations, with tools that can manage contract origination through to termination. NFS Ascent has been taken up by a number of European motor finance providers and UK finance institutions.
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Think global, act with agility
While NETSOL is helping businesses manage coronavirus upheaval with its intelligent systems, it is also helping them return to full productivity, whether through working in a safe office environment or virtually. In December, NETSOL revealed NXTa smart workplace-solution that uses 3D mapping technology to help employers build a digital workplace community. It allows for virtual and workplace check-in, and helps organisations meet safety protocols, such as contact tracing, wellness checks and socially distanced hot-desking. Naturally, NXT is already deployed across all NETSOL offices and it offers an example of how NETSOL embodies the classic entrepreneurial advice of design a product for yourself first.
NETSOL’s focus on innovation can be traced back to two things: the unique circumstance in which the business was founded and the leasing and asset finance sector itself. As Tobey explains, “What NETSOL developed 25 years ago is different to what it does today. There is so much change in the way money is lent and how assets are financed. Early on the business knew that the more knowledge NETSOL can collect, the more successful it was going to be at understanding our customers and their requirements.”
NETSOL is a global business with a presence in eight strategically located cities across the globe. It has been active in Europe for over 20 years, winning contracts with major finance providers across the continent. Tobey says it is the firm’s flexible approach to technology, along with its size, that has helped it adapt easily to new markets.
“Our scale and ability to deliver products and services remotely have allowed us to adapt better than many other vendors,” he explains. “A lot of them are too focused on what they offer. We’re much more flexible and able to adapt to a customer’s needs. We offer a global solution that complies with most of the major markets around the world. So when we enter a new market, there’s only small variations in local customs and regulations that we need to adapt to. Our main focus is to create a product that provides everything straight out of the box, but we have the resources and ability to make changes for the customer.”
NETSOL has a proven track record in Asia-Pacific where it is best known for NFS Ascent. The platform has a significant share of the Chinese auto finance and leasing market and is now the preferred partner of choice in the region. In 2020, NETSOL signed a multi-million dollar deal with a global automotive financial services company in China.
NETSOL predicts there will be a rebound in the demand for vehicles as global vaccine rollout continues and economies begin to recover. It also predicts that internet-of-things technology will become increasingly used by car rental and leasing companies to maintain and manage fleets and NETSOL can help customers continue to succeed in this new, more digital-first environment.
The Otoz approach
NETSOL’s commitment to innovation was cemented in 2019 when it launched Otoz Mobility. It is a Bangkok-based tech subsidiary focussed on finding opportunities in cutting-edge technologies such as machine learning, artificial intelligence and blockchain, all of which are nascent in their development but have great long-term potential.
Otoz is a technology platform, available for organisations keen to enter the wider mobility business on a white-label basis, whether that is auto finance companies within larger automotive organisations, original equipment manufacturers (OEMs), or some of the new emerging subscription car ownership schemes. The platform aims to help maximise the lifecycle of auto assets by using the power of the sharing economy.
“As a platform, Otoz uses blockchain applications to create a ‘digital passport’ for every car registered on the platform, meaning that one can track the history of that vehicle during any future transactions,” explains Murad Baig, Chief Innovation Officer at Otoz. “The platform uses machine learning, artificial intelligence, internet-of-things telematics and data analytics to help capture more data. The circular economy, of which this is a part, has been long sought after by those in leasing and asset finance and the opportunities are boundless.”
The innovation seen at Otoz has filtered into other areas of the business, says Baig. NETSOL recently invested in Drivemate, a Thailand-based car-sharing platform, and it is already beginning to implement some of the Otoz technology into the business: “By partnering and investing in Drivemate, we not only have a cost-effective and low-risk means of beta testing our new technologies in the real world, but we have an additional opportunity to leverage the expertise of a well-established company.”