Few would disagree with the notion that the only thing changing faster than technology is consumer expectations. When it comes to auto finance there is an expectation that lenders be accessible to the borrowers through a variety of channels and reach them in step with the fast-paced way they live and work. Dialing landlines and sending snail mail are no longer the most efficient way of reaching the untethered borrower who wants to utilize technology to make their engagement with lenders more efficient. A recent Fiserv survey found that Millennials, Gen-Xers, and households of $100K-$149K were the cohorts most willing to experiment with new ways to speed up the loan process (2016 Fiserv).
Just within the last year a new technology has become increasingly pervasive in homes across America. The Amazon Echo and its industry counterparts are forging a path to make routine tasks audible and effortless. Along with capabilities to reorder a household good or play a music library on demand, its introduction the gave banks the ability to tap into the power of its Alexa Voice Service to make it easy for consumers to use their voice to perform their banking functions while in their homes performing other mundane tasks. If banks and other institutions have the opportunity to engage people so effortlessly in their homes going about their daily lives, where else can we as an auto finance industry reach them?
It might be in their car.
AAA recently reported that the average American spends 17,600 minutes per year in their car. This is a staggering 12 days a year or stated another way – 24 hours a month – that we spend sitting in traffic, going to work, running errands, or driving to see friends! It would seem that connecting with a borrower while they are on the road could become the perfect place for auto lenders to interact with them about the vehicle they have financed with them. Infotainment systems, which are hardware and software solutions built into or added to vehicles in order to enhance the driver and passenger experience, may be the next new technology channel for lenders to leverage for that interaction.
Imagine a lender sending an actionable message to their borrower through the car’s infotainment system when the car is turned on. For security purposes it would ask permission and verify credentials to initiate communication with their lender. Lenders could then initiate a conversations about whether the borrower is interested in refinancing their loan, exploring options to buy out or turn in their lease, updating their account profile, or notifying them about an upcoming payment. Interactions like these could be easily automated and handled without lender involvement and while the customer is commuting home to their family.
This sounds easy enough but the challenge here has been that each of the infotainment systems, which vary by make or even model of vehicle, maintain their own standards forcing integrators to maintain dozens of protocols to support the interaction or risk alienating the majority of their customers not on a particular infotainment system.
A solution may be on the horizon. Ford and Toyota recently announced a partnership, along with an invitation to other manufacturers to join them, that intends to create a single standardized set of API’s for vehicle infotainment systems. These API’s will greatly advance the ability for solution providers, such as Fiserv, to create a single set of integrations that would facilitate managing the lending lifecycle from where the borrower already is, their vehicle. These new partnerships between solution providers and manufactures will enable lenders to reach their borrowers in yet another easy and accessible channel where they spend 48 minutes of their average day.
While tools like web chat, self-service web portals and SMS notifications are increasingly being adopted by lenders as a more innovative ways to engage with borrowers, it is feasible that this new channel may eventually leapfrog these technologies with involvement from the right players.
Buckle up, it’s going to be an exciting technology ride.