Automobile Finance’s Dealer Floorplan: New Dog in the (Grow Revenue) Hunt
Report Summary
Automobile Finance’s Dealer Floorplan: New Dog in the (Grow Revenue) Hunt
New-car sales are strong, and U.S. automobile dealers need financing to keep cars on the showroom floor.
Boston, September 10, 2013 - Banks' commercial and consumer lending segments must grow revenue without engaging in risky business, and financing automobile dealers, a commercial credit segment with a quarter-trillion-dollar annual impact, may prove a fine opportunity to sound the revenue-hunting horn. Leveraging strong dealer-floorplan relationships could help banks build indirect retail relationships. But beware! Banks embracing indirect lending initiatives must protect their fraud- and reputational-risk-related virtue.
Written by senior analyst Christine Pratt and based on a February to June 2013 Aite Group survey of 20 of the top 50 U.S. consumer and commercial lending institutions, this Aite Group Impact Report details the state and size of the U.S. auto finance industry. It also focuses on opportunities for banks and credit unions to expand this business to other product sets, advises on opportunities and challenges in launching an enterprise-wide auto-finance initiative with dealer floorplans, and highlights possible rewards for forward-thinking financial institutions. It is the second in a two-part series about U.S. commercial credit--find the first here.
This 26-page Impact Report contains eight figures and three tables. Clients of Aite Group's Wholesale Banking service can download the report .