By Tony Willard
New consumer finance regulations in force from April 1 represent a seismic shift for the motor industry, said Gerald Grimes, managing director of Hitachi Capital Consumer Finance.
“The change may bring unforeseen benefits to dealers as well as customers, because of a more transparent finance process and a better deal under ‘treating customers fairly’ (TCF). Dealers will have to work more closely with finance partners, who should be able to add real value to the marketing and sales process.
Karl Werner, head of sales and marketing, MotoNovo Finance, said: “The cost of providing finance in the showroom will rise, making it even more important for dealers to embrace change in the way they operate.
“The key will be to make dealer finance more attractive to more customers, and earning a little from a lot. This embraces the spirit and letter of the new regulatory regime and will help to sell cars as well as finance.
“Dealers really must work to get their finance front and centre in customers’ buying cycle. For most, that means making finance more transparent and obvious online.”
Martin Wheatley, chief executive, Financial Conduct Authority (FCA), given responsibility for overseeing about 50,000 firms in the UK’s £200 billion a year consumer credit market, said: “The FCA will take a tough approach to consumer credit with stronger powers to clamp down on poor practice than the previous Office of Fair Trading regime. Our supervision of firms will be hands-on and we will closely monitor how providers treat their customers.”