Many powersports financial providers are setting their sights on making technology upgrades, in the face of heightened competition, in order to be compatible with new sales avenues that are emerging — such as mobile apps — said Paul Kramarz, director at PricewaterhouseCoopers LLP.
Much like the auto industry, “there is a lot of pent-up demand from the recession which goes back to the 2008 and 2009 budget cuts,” Kramarz told Powersports Finance. “No one made investments then, and now it’s at a point where things have been good and they are looking to make investments.”
There is an “increased appetite to invest” across the industry, Kramarz said, mostly to “update the core infrastructure, replace old-name systems, and to support some of the newer interfaces in the market – like e-contracting,” he said. It is often easier to put in a whole new system than to make the current, older system compatible to support new sales avenues, because “things are turning quickly” in the industry,” he added.
Los Angeles-based MotoLease LLC is one of many powersports lenders that is boosting its technology infrastructure. The company recently debuted a new lessee portal and My MotoLease mobile app on May 25, which allows lessees the ability to access their account to check payment history, make a payment, and get instant payoff quotes through their smartphone or web browser.
“There are a lot of aged systems out there that need to be replaced, and that’s the immediate area where PwC is assisting,” Kramarz added. There is a digital evolution occurring, and as the vehicle purchase transaction becomes increasingly mobile, lenders want to know how to stay connected.
“If more and more transactions are done online and F&I is minimized, it’s important to make sure you [the lender] stay relevant,” he said. “Is there some opportunity to include financing in that transaction? The answer is yes, but I don’t think there is a winning methodology. Even though mobile is a big topic, there are still customers who walk into a dealership. So it’s really what additional channels are emerging and which to invest in.”
Lakeway, Texas-based Excel Finance, for example, plans to roll out an upgraded loan-origination system through TCI this year to add an online link to its contracted dealers’ websites to allow consumers to directly apply for loans with Excel, and receive instant preapprovals. Previously, consumers would have to apply at the dealership.