Customers looking to purchase a vehicle on a contract need to provide a series of documentation. Document collection is therefore an important process within the auto finance industry. Paperwork is one of the biggest headaches for both employees and customers. When someone purchases a car on finance, they have to show proof of a utility bill or credit score to prove they can afford to pay the lender back monthly. In 2019, Americans had a combined $1.3 billion in auto debt, emphasizing the high demand for buying a car on loan. This figure would have organically increased because companies such as Toyota had robust vehicle sales in all continents, despite the pandemic.
Below we’ll discuss why document collection capabilities are an important investment for auto lenders.
Document Collection is Crucial for Auto Lenders
Document collection is vital for auto lenders, as every customer who wants to take out a loan must go through a long process with extensive amounts of paperwork. With competitors offering the same cars at competing prices, customers could be more likely to purchase from them.
The period where the customer is waiting for the paperwork to be approved is out of their control and can often be nerve-racking. The process of scanning each document and waiting for it to be verified could be easily solved by introducing a digital service. This service could work instantly, and also let the customer track progress, making the buying process straightforward to complete. In turn, a better experience for the customer can make the auto lender more appealing and help increase loyalty.
To accomplish this, a digital document collection process needs to deliver the following capabilities:
1. It’s Instant
Digitalizing document collection enables the process to be born for mobile completion. Purchasing a car via a contract requires a significant amount of paperwork. Adding digital completion to this process could have a substantial impact on the dealership’s ROI. Customers want the luxury of documents being collected instantly; the wait time is off-putting. Long wait times due to lengthy paperwork fail to understand the customer’s behavior and lead to a frustrating customer experience.
This makes uploading documentation, which is usually time-consuming, convenient for customers as they can upload documents effortlessly. The process of purchasing a vehicle is often a big decision, digitalizing the document process makes the experience seamless and is key for both customer and auto lender. Employees gain more time to build a relationship with the customer, which benefits the after-sales process by wrapping everything up in a single digital package.
2. It Can Be Done From Anywhere
Digitalizing the work tools enables the process to be remote. As the application is built for mobile completion, it allows documents to be collected from anywhere. Since documents can be sent in real time, customers can buy vehicles from any geographical location, making the process effortless. Real-time completion ensures that stips are collected on the spot from the customer’s phone. There is no need to download an application or PDF, or to print or scan a document — making the application seamless.
Millennials are taking out auto loans at a 21% higher rate than gen x did at the same age. Now catering to these generations is essential as they are fully in the digital age. Therefore, mobile completion is critical to making a process in-line with the expectations of this generation of customers, and making the process of buying a car fast and efficient.
3. It’s Workflow-based
Using a digital completion solution means that it can be easily integrated into existing workflows. By putting the customer first and removing every obstacle that stands in the way of them completing the transaction, auto lenders are better equipped to close more sales.
While there have been misconceptions about whether implementing a document collection program would disrupt the workflow, a digital completion solution actually helps in the transition process by making it easy and efficient for both customers and employees to use. Businesses that have implemented digital tools into the workflow have seen a significant increase in productivity.
4. It’s Integrated
Digital document collection is also integrated. This saves both the employee’s and customer’s time. Because the application is integrated, efficiency increases on both ends as customers are more likely to send stips at their convenience. Traditionally the customer would have to book an appointment, gather all of their paperwork, get that paperwork checked, and then wait a few weeks to see if it’s been approved.
The integration process is fast and straightforward, making future transactions effortless for customers and employees. The anxiety of keeping all stips in place and chasing customers for documents is taken away when digital tools are implemented. In addition, APIs allow an easy plug-in to existing core systems for fast ROI.
5. It’s Secure and Compliant
When stips are uploaded, they are stored in a digital cloud. All documents are encrypted to ensure maximum security. To protect documentation, businesses can set up security checks such as one-time passwords for customers, reducing the chances of fraud. Since the pandemic, digitalizing documentation has become critical and the only way for businesses to function correctly due to social distancing guidelines.
In 2016 the UK government announced they saved £600 million in five years since digital solutions were introduced. However, this figure would have increased due to recent events, with all documents being sent digitally. Consequently, by illustrating that digital solutions saved money and were safe, it should give all stakeholders in the auto finance industry confidence to use this service.
6. It’s Agent-Guided
Digital solutions are agent-guided. Sometimes getting documents approved, such as credit card bills, can take weeks. Customers may be sent the incorrect document, or one that’s been processed wrong. As a result, this prolongs the process, and by the time it’s completed the customer has been put off and decide not to buy the vehicle.
As the prevalence of working remotely continues to rise, having the agent-guided tool presents that human touch. The agent will guide the customer through the process, ensuring that they are uploading the stips correctly. This reduces errors and ultimately turnaround time.
Document collection is an Important Investment for Auto Lenders
The document collection process is essential for auto lenders. To buy a car, they have to show proof that they can afford the monthly installments. Digitalizing the workflow for this makes it convenient for both the customers and employees.
Significant paperwork is an inconvenience for customers, sales are more likely to take longer to complete which slows down the transaction. The risk of documents being made fraudulent or lost also increases.
Stips can be collected instantly via the customer’s phone. Documents can now be sent in real time, increasing the speed of completion. Using digital tools is catering to generation x, generation z, and millennials. These are all part of the digital age; hence, altering your dealership to be compliant with their lifestyle increases the likelihood of sales and onboarding new customers. In addition, with digital document collection becoming more the norm amongst consumers, it removes the anxieties of using technology to store important information.
To learn more about Lightico’s eSignature, eForms, document collection, visit lightico.com.