Armstrong said the FCA was likely to come down hard on any companies whose staff were mis-selling. This could result in a total loss of licence and/or fines. Staff with SAF accreditation are required to retake the test every 12 months to ensure their knowledge stays up to date. “This reduces the room for error, and works in the favour of both the customer and the accredited person,” said Armstrong.
Mark Gow, sales director at broker DSG FS, expects dealer reliance on technology in offering loans to be one of the biggest F&I developments over the next 12 months. This enables them to tailor customer quotations and compare products such as PCP and HP side by side on the same screen. “That helps customers make an informed decision, which is going to be crucial in meeting FCA regulations that focus on treating customers fairly,” he said.
Gow expects technology allowing dealers to pre-screen a customer’s credit status at point of sale to be a key trend. “Historically, dealers have presented finance offers based on a customer having an A1 prime credit status,” he said.
“This assumption can lead to dissatisfaction if a dealer phones a customer a few days after ordering their car, saying the terms have changed and the monthly payment is much higher than originally stated.”
Paul Brotherton, head of business strategy, improvement and support at Black Horse, said most dealers still indicated a preference for driving showroom traffic from their website. “Application and fulfilment of finance online is not available,” he said.
“Manufacturers’ websites are far more advanced but mainly in the area of vehicle configuration. Research shows there is an opportunity for dealers to improve the speed of follow-up of web enquiries through ‘contact us’ functionality.”
Brotherton said most dealers relied on third-party software providers working with their media company. “Lenders are generally supporting this type of initiative, but none really takes the lead role at the moment,” he said.
David Challinor, managing director of The Funding Corporation, which provides loans for used cars sold through its ACF Finance outlets, said: “Our customers’ car choice will not necessarily be restricted to the least expensive models.
“Credit limits are based on ability to afford repayments. Many people with marginally impaired credit records are in higher income brackets with secure employment.”
Dealers bullish about loans for both used and new cars
Lenders are optimistic about prospects for continuing high levels of new car finance for retail buyers. They are also bullish about prospects for dealers offering showroom advances for used stock but urge them to continue to be proactive.
Kirk Franks, head of national sales at Alphera Financial Services UK, said: “Record new and used sales figures in recent months mean the automotive sector is enjoying a period of success.