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A next step for qualified finance experts

Gerry Kouris of Alphera Financial Services

Author: Gerry Kouris (pictured), marketing manager at Alphera Financial Services

In its 2018 Business Plan, the FCA reiterated the fact that it will be undertaking further work on responsible lending, particularly the approach taken by motor finance lenders to assessing creditworthiness, including affordability.

The regulator has even committed to carrying out a programme of ‘mystery shopping’ among UK car retailers over the summer, to gauge the level of compliance in car finance sales.

In this environment, dealer sales staff must have the skills and knowledge necessary to properly qualify a customer’s needs and deliver the facts in a clear and transparent way to enable informed decision-making.

Yet, in a recent UK-wide independent consumer survey commissioned by Alphera, conducted among 1,035 motorists, the majority of consumers said they were unaware of dealers’ obligations in the sale of car finance.

The survey found that two-thirds of UK motorists (64%) are unaware that salespeople are required to discuss their financial needs and requirements when purchasing a vehicle on finance. More than half of motorists (58%) didn’t know that dealer sales staff are responsible for discussing repayment obligations.

The same proportion of respondents were unaware of the responsibility to outline a finance product’s terms and conditions and details of additional charges.

More than three-quarters (77%) of respondents didn’t know that dealers must outline how purchasing a vehicle on finance may affect their credit rating.

These numbers highlight the low level of consumer awareness of dealer obligations when selling finance and insurance products. This presents a great challenge as well as an opportunity for motor retailers to build greater levels of trust between themselves and their customers.

The deficit between dealers’ obligations and customers’ awareness of their rights means sales staff must clearly explain every aspect of a finance product, and properly assess the customers’ needs.

Addressing this gap and offering total transparency will enable dealers to empower customers to make an informed decision, giving them confidence that a finance product is truly appropriate for them. In the long term this approach will foster greater customer loyalty and more sustainable income for dealers.

In seeking to improve standards across the industry and enhance transparency in the sale of car finance, the Institute of the Motor Industry (IMI) is offering a new accreditation scheme for finance and insurance (F&I) sales specialists.

The accreditation scheme complements the existing Specialist Automotive Finance (SAF) programmes from the FLA, enabling a practical application of skills and knowledge. The SAF qualification is a well-established and highly respected qualification that everyone in the industry ought to have.

F&I Accreditation from the IMI is a natural progression for those who pass and retain the standard SAF competence test on an annual basis – it represents a significant step towards establishing higher standards in the sale of finance products.

Adrian Dally, head of motor finance at the Finance & Leasing Association, recently said: “I have no doubt that our members consistently put the interests of the customer first – it simply makes good business sense. The value of training and accreditation programmes lies in the opportunity for F&I professionals to hone skills and have their experience and expertise officially recognised. I would encourage everyone to join this drive for official development and recognition of F&I expertise in the motor industry.”

Ultimately, F&I can be simple and clear. It is our collective role to help ensure that relevant staff have the confidence to present products properly.

This ‘common standard’ approach will demonstrate to the FCA, and car buyers across the UK, that the motor industry is worthy of its confidence.


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