Rising default rates and increased regulation are causes
for concern.
Go deeper with GlobalData
The UK’s motor finance collections specialists foresee tougher
operating conditions ahead, but expect to face them with efficient
departments honed by experience of the post-recession collections
environment.
While rising default rates and
increasing levels of regulation are issues of concern, recent
improvements in fraud prevention and an improved level of
communication between the sales and collections functions of motor
finance businesses have been hailed as improvements seen across the
board.
These topics and more were
discussed at length on 8 September, when a selection of the
country’s most senior collections staff met for a summit at
London’s Cornhill Dome Room, hosted by Motor Finance and
collections specialist Optima Legal.
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By GlobalDataOn the attendee list for the day
were departmental heads from RCI Banque, FGA Capital, Banque PSA,
Volkswagen Financial Services, First Response Finance, Moneybarn,
Private & Commercial Finance and First Independent Finance.
In a survey of 23 finance houses
prior to the event (see below), some 67% of respondents
predicted a rise in car finance default rates over the next 12
months, while 74% agreed that in the current economic environment
there was a need for the terms and conditions of finance agreements
to be “more robust”.
In a finding that reflected current concerns about excessive
regulation, some 61% of respondents felt that the FSA’s Treating
Customers Fairly (TCF) regulation had caused some degree of
conflict of interest with dealers in point of sale
relationships.
