“With showrooms set to re-open in England, Wales, and potentially Northern Ireland on April 12th, joining those in Scotland which are already open, dealers need to be ready for face-to-face contact with better informed, empowered and protected consumers who are increasingly likely to shop around for their car finance.”
Our Deputy CEO Karl Werner has been reflecting on the recent FCA research published in February that gives an insight into how Covid-19 has impacted consumers managing their finances;
- 38% of consumers shopped around for their car finance
- 60% of consumers shopped around for their personal loan
- Consumer satisfaction and trust ranked higher for personal loan providers
As a result of the last year, 29% of people are now more likely to shop around for products, excluding insurance.
“The FCA's work reveals a classic ‘opportunity & threat’. Focusing on the opportunity, the already high number of people researching personal loans is likely to increase. More people could consider dealer finance if it is competitive against a personal loan option. It is why a risk-based pricing approach from dealers is so much more compelling than a fixed interest rate, as personal loan providers continue to demonstrate. The obvious risk is in not doing this,” observes Karl, highlighting three actions that dealers should already be embracing ahead of reopening and to comply with FCA requirements.
- Review and update your online finance promotional activity, showcasing your pricing proposition to capture car buyers interest as they shop around online, staying aware of financial promotion requirements;
- Ensure that you have all necessary processes and controls in place to support Commission Disclosure online and in the showroom;
- Develop your online finance proposition and capabilities to provide a more transparent and customer-controlled finance journey.