NZers Would Like To Go Online To Finance Their Next Car
FICO Survey: New Zealanders Would Like To Go
Online
To Finance Their Next
Car
AUCKLAND
— 6 July, 2018
Highlights:
• 40
percent of consumers in New Zealand and 42
percent of consumers in Australia
indicated they would like to apply for their next automotive
loan online
• 66 percent of respondents
believe that convenience was the
main reason for choosing an online channel for automotive
loan applications; 52 percent say it allows
them to easily compare shop across
lenders
• 44 percent of
consumers in New Zealand currently spend 30 minutes
or more completing the loan financing
process
Download the New Zealand version of the research
report here.
Silicon Valley analytic software firm FICO, today announced the results of its first global survey on consumers’ automotive finance experience and found a growing inclination for vehicle shoppers in New Zealand to apply for auto loans online. 40 percent of respondents said they would likely go online to obtain their next loan, the third highest figure among the nine countries surveyed. In Australia, it was 42 percent, and in the UK, 48 percent.
These results indicate a significant shift in channel preference for loans with the majority of consumers. 62 percent in New Zealand and 45 percent in Australia have applied for their most recent auto loans at dealerships.
“Unlike the US, where seven in ten respondents would rather apply for their next loan at a dealership or through a visit to the bank or lending institution, New Zealand consumers are more open to the idea of digital financing,” said Vaile Mexted, country manager for New Zealand at FICO. “Convenience, speed and ability to comparison shop across lenders were the top reasons given by consumers. Unlike other markets, auto dealerships and banks were not seen as having a pricing, security or convenience advantage in the New Zealand market.”
When it came
to time spent on the transaction, 44
percent of consumers in Australia currently spend
30 minutes or more completing the auto loan
financing process.
While this pales in comparison to
countries like Mexico (65%), USA
(62%) and Chile (60%), there is
much room for improvement in terms of speed and
efficiency.
Consumers are very open to instant, pre-qualified offers to improve expediency. Only 15 percent of New Zealand consumers would not accept such an offer and may prefer instead to work through a traditional, full loan application process and credit check.
“Predictive scoring analytics can help to ensure creditworthiness accuracy and reduce the manual underwriting that’s still takes place to complete a loan today. Optimisation of deal structures can ensure an appealing offer is made to the consumer while ensuring profitability for the lender. Instant and accurate lending decisions will deliver a positive customer experience and grow the loan books of lenders,” added Mexted.
FICO’s independent
research surveyed 2,200 adult consumers
across nine countries including the US, Canada,
Mexico, Chile, Australia, New Zealand, Germany, Spain, and
the UK were surveyed. Respondents were between the
ages of 18-64 who acquired a loan on a new/used vehicle
within the last 3 years.
About
FICO
FICO (NYSE: FICO) powers decisions that
help people and businesses around the world prosper. Founded
in 1956 and based in Silicon Valley, the company is a
pioneer in the use of predictive analytics and data science
to improve operational decisions. FICO holds more than 185
US and foreign patents on technologies that increase
profitability, customer satisfaction and growth for
businesses in financial services, manufacturing,
telecommunications, health care, retail and many other
industries. Using FICO solutions, businesses in more than
100 countries do everything from protecting 2.6 billion
payment cards from fraud, to helping people get credit, to
ensuring that millions of airplanes and rental cars are in
the right place at the right
time.