Consumer Portfolio Services Inc. has steadily increased direct-to-consumer loan applications and originations since the April 2015 launch of its direct lending program. Expansion in the direct-lending space enables CPS to reach a broader customer base, enabling consumers to apply and be pre-approved online, before visiting a dealership.
“We generally then direct them to a dealer and so, the big rub in that sort of whole idea of direct, is the customer goes to the dealer that you’ve asked him to go to and the dealer tries to get him financed somewhere else,” Bradley said during the company’s fourth quarter earnings call Wednesday. “But we seem to be getting through those hurdles.”
The results have been “far better in terms of credit performance” from customers that come through the direct lending channel versus the indirect route, Bradley said. Currently, the company generates about 100 direct-loan originations a month, but hopes to bump that number up to 125 this year, which the company is “very well set up” to do, Bradley said. CPS is also working to boost its digital capabilities, Bradley said. “It turns out that more things are going to be done from smartphones and so we’re doing many things to access that end of the market,” he said.
