With all the hype surrounding the auto manufacturers last week, this news item got short shrift. Nonprime indirect lender Consumer Portfolio Services has launched a pilot program that enables borrowers to make their monthly car payments via cell phone.
The system is straightforward: CPS customers sign up for Western Union’s Bill Alert Text Message Service, then enter their CPS account numbers and payment information. When payment is due each month, they receive email alerts through VeriSign. Then all they need to do to pay is text “yescps” to initiate a Western Union transaction (for which they’ll pay an extra $10).
Ahhh, finally an auto lender that understands the benefits of mobile technology. Sure, the average CPS customer is 41 years old, but even among that age bracket, text messaging is climbing. Here are some recent stats:
* More than 1 trillion text messages were sent or received in 2008, almost triple the volume from 2007 (363 billion).
* On average, more than 3.5 billion SMS messages are sent or received per day.
* 82% of adults 18 to 24 are avid text message users.
* Of the 25 to 49 age bracket, 72% use text messages.
* In all, 53% of those who send and receive text messages are at least 35.
Needless to say, the concept is certainly on target. I would add, though, that cell phone payments should have been part of the auto finance industry for years now.
