9:35 am, September 22, 2020
Motor finance firms have to work now with vehicle retailers and technology providers ahead of new FCA rules coming in next January.
That’s according to online motor retail specialist iVendi, which says there needs to be uniformity over all the channels via which they sell their products.
It says many dealers seem to be focusing on ensuring their own showroom systems comply without checking that third-party platforms and other routes to market also meet requirements.
Chief executive James Tew said: ‘Key among the FCA changes are the banning of discretionary commission and the question of how the existence of commission is presented to the consumer in the future.
‘Because so many physical and online channels are used by motor finance companies and their intermediaries, this creates something of a challenge.
‘We are very much aware that everyone needs to be working together to reduce the impact and business disruption in this area right now.
‘The January deadline is only a few months away, and more uniform processes and disclosures may prove to be a much more difficult task than first imagined.
‘Lenders have different commission models across their product ranges and, as such, the “nature” of these, to use an FCA term, needs to be disclosed against each of them.’
Increasing the prominence of the availability of commission will also most likely need changes to the online finance journey, he added.
‘Ensuring that everything is compliant on the day the regulations come into effect is very much a priority for us.’
Tew said there were still some grey areas over how the FCA regulations would be operated by motor finance firms.
‘Because we are FCA-authorised ourselves, we are able to bring a high degree of insight to the whole issue.
‘Our fundamental approach is to ensure the customer is placed at the centre of the entire process, with a high level of transparency and information provided, to meet the general Treating Customers Fairly principles in letter and spirit.’
- NEW Car Dealer Mag issue 151 out now – Read it here
- Have you nominated your dealership for a Used Car Award? – Do it here
- Join our breaking news WhatsApp group – Click here to join now
