While digital transformation is gaining popularity in every industry — and is here to stay — many people are still a little wary of committing to the cloud and software-as-a-service (SaaS) products, in which software and servers move from your computer into the cloud, which is accessible via the internet. This means it is no longer necessary to own or manage the infrastructure, and ready-to-consume software from a provider can be used.
Unfortunately, cloud myths continue to circulate that may impede auto lenders from taking advantage of the many benefits of the cloud and SaaS; benefits that can automate processes, simplify your IT infrastructure, help your team respond quicker to deals and reduce operational costs.
During my years of experience in launching and managing cloud solutions, here are some of the most common cloud myths I have encountered and what auto lenders should know:
Cloud Myth 1: SaaS is not designed for small or large companies
One of the most common myths is that a SaaS model is designed for certain companies, based on size or volume.
This is simply not true. A company’s size, location, volume or technical knowledge doesn’t matter when it comes to benefiting from the value of SaaS in the cloud. That’s because cloud platforms and the SaaS solutions they enable are scalable, simple to deploy and fit all budgets, as you only pay for the capacity you use.
This means smaller companies don’t need technical expertise, sales volumes or big budgets to benefit from the value that a cloud-based platform and SaaS solutions bring. And larger companies can trust this model, adding rapid scalability as their business grows or changes, such as cross-regional requirements, integrations, etc.
Cloud Myth 2: Security of a SaaS platform is untested
Another common myth is that the security of a SaaS platform is untested is another common cloud myth.
You can easily debunk this myth by logging into your computer or accessing a number of apps on your phone. Many SaaS solutions in the cloud are applications you use every day, such as LinkedIn, Microsoft Office 365, Zoom and Salesforce.
While overall SaaS security is proven, concern about security in the auto finance industry is valid. It’s recommended that auto finance lenders choose a SaaS provider that conducts third-party audit assessments with reputable organizations such as System and Organization Controls (SOC). These reports, produced during an audit, offer a set of guidelines to ensure security, availability, confidentiality and process integrity of financial organizations. To alleviate any concerns, talk with your SaaS provider to better understand how they handle security in the cloud.
Cloud Myth 3: SaaS is complex to buy and use
Another misconception is that SaaS is complex to purchase and use. It’s not complicated at all, it’s just different. Specifically, the scope of services is different. Here’s where asking your SaaS provider the right questions will help dispel any misgivings about the security of a cloud-based model and SaaS.
And when it comes to using a cloud platform and SaaS solutions, it’s designed for simplicity. All your team needs is an internet connection to access a cloud-based platform in the office or remotely. You can also give authorized users instant access, a huge time saver. With minimal onboarding, every user has immediate access to all the ready-to-consume features that help auto lenders quickly experience a faster time to value and close deals.
Cloud Myth 4: SaaS limits data access
Limited access to data is the most common cloud-based myth. People believe that when they release ownership of their data to the cloud, it’s difficult to access. Historically, that was true, but no longer.
That’s because SaaS and major cloud providers like Amazon Web Services (AWS) offer services that enable secure, flexible and agile options for data engagement. This includes traditional reports as well as near real-time streamed data where you can customize your reports. This is an exciting feature as it captures data as it changes, so you no longer have to maintain spreadsheets that quickly become outdated.
Because you can now trust your SaaS provider is managing and maintaining the integrity of your data, your team can turn their focus to analyzing data to make your business more successful.
Cloud Myth 5: Hosting and SaaS in the cloud are the same
The final most common cloud myth is that hosting in the cloud and SaaS in the cloud are the same thing. However, these terms are not interchangeable. They are two very different models.
Essentially, with a hosted model, the vendor provides the infrastructure; the onus of maintaining, testing and upgrading software belongs to you. The scope of services with a SaaS provider is greater. For example, you have access to ready-to-consume software that is easily accessible over the internet. Experts take care of all the maintenance and ensure that innovative technology is deployed regularly. This is all done behind the scenes, meaning there is no disruption to your business operations.
More auto lenders choosing outcomes over ownership
More auto finance organizations are choosing outcomes over ownership to grow their business. This means they prefer to consume or use proven services rather than owning and managing the infrastructure for their loan origination process. A holistic SaaS platform like IDScloud, for example, delivers expert, fully managed services that include infrastructure and application management so you and your team can focus time and energy on other parts of the company to grow your business.
Ultimately, a true SaaS solution in the cloud means you can more quickly close deals, securely capitalize on opportunities, reduce operational costs, expedite decision-making and create a positive customer experience.
Auto Finance Summit, the premier industry event, returns October 27-29 in Las Vegas. The Summit continues to bring together the best and brightest in the industry year after year for unparalleled networking and professional education. To learn more about the 2021 event and register, visit www.AutoFinanceSummit.com.