By Bogi Palsson, Business Unit Manager, Business Analytics
Providing software for vehicle financing has been Banqsoft’s core business since the company was founded in 1994. From this experience we’ve seen how the industry has long been plagued with challenges around data gathering and reporting.
Extract, transform and load processes often take a long time for vehicle-financing companies to perform, with the result that stale data ends up being used for analysis. This is simply not good enough in today’s market.
To win contracts you need to have efficient credit-granting and onboarding processes. If you make a potential customer wait too long for a financing decision, they may accept an offer from another company. Having access to timely and accurate data – from the sales floor to the back office – is the key to speedy decision making.
Real-time data is also critical for managing your incoming leasing revenue against the depreciating value of your vehicle assets. We all know how a significant mismatch between the value of a contract and the value of an asset represents a huge risk for any leasing company.
If your business is heading in this direction, you need to know long before it gets there. You may find out too late if your reports are only weekly or monthly.
This is the background against which Banqsoft has developed IntelliView – our real-time analytics solution for the vehicle-financing industry. In this article I will explain how the solution works and demonstrate its benefits for our customers’ business.
I joined Banqsoft as a software developer in 2004, so I’ve seen our own capabilities develop profoundly since those early days. I am immensely proud of the data models we created for our legacy reporting solution, and we’ve been building on this knowledge ever since.
We have long believed that the future of reporting lies in using business intelligence and analytics to empower our vehicle-financing customers to take advantage of the vast amount of information that has been collected over the years. Developing a solution in this direction has been a top priority for us.
In short, we saw how there is a need to deliver real-time data directly to different stakeholders at different points in the vehicle-financing chain. For example, a dealer needs to call up a specific set of data while sitting with a potential customer, so that a timely offer can be made. The onboarding team, back-office staff, managers and other members of the vehiclefinancing operation all need reports and dashboards for their own sets of purposes.
"Real-time analytics solutions are transforming vehicle financing"
"To win contracts you need to have efficient credit-granting and onboarding processes"
Leasing companies always want to keep track of the residual value of contracts getting close to maturity. If you’ve agreed to take back a leasing asset at a certain price, it’s vitally important that you know how many such assets you will get back at any given time, as well as the expected value of said assets. Changes in the market can cause residual value to fall lower than originally expected.
One can guard against this by getting information in real time on different vehicles, including their average sales prices and how long they stay in stock. When you spot a negative trend in sales prices, you may choose to offer the customer the option of buying the vehicle at a reduced price. This way you can to some extent minimise your residual value risk.
Keeping track of your competitiveness is another important area. As a leasing company in a fierce contest with other vendors, you need to be on top of the credit process and know exactly where you’re losing any business. Is it because your decision making is too slow? Or are there some other variables in the score card that need fine tuning? Using the analytical models provided by IntelliView allows you to make better-informed decisions.
We’ve really just started to scratch the surface with this immensely powerful analytics solution for vehicle financing. Our next step is to roll out general ledger and reconciliation models. We’re also looking into embedding the Power BI reports and dashboards directly into our different front-end solutions.
When it comes to data sources, we are constantly evaluating our different markets to make sure the solution has everything our customers need for that crucial competitive advantage.
Bogi Palsson is Business Unit Manager, Business Analytics
Tel: +47 22 31 44 00.