Asset Finance Connect UK Conference: how tech is driving change in the auto and equipment finance

The sun was shining and the conversation flowing at the Asset Finance Connect Summer Conference, held in London on 13th June. Over 375 senior executives heard presentations from a broad range of speakers from the auto, equipment and asset finance sectors, and made the most of the opportunity to network and catch up with colleagues.

The AFC Summer Conference, with Alfa as the headline sponsor, focused on how tech is driving change in auto and equipment finance with the increasing use of AI and growing ecosystems, and how innovation is driving the green transition.

Session streams

In the stream sessions, delegates had the opportunity to examine the critical issues facing their sector.

Auto finance keynote speaker, Toby Marshall joined AFC’s head of content David Betteley to talk about GWM ORA’s new Chinese electric vehicle brand – the Funky Cat – which launched into the UK market in Q4 2022 as a disruptive, premium alternative to more established European mainstream brands.

The discussion focused on how Chinese OEMs are transforming the European and UK BEV market and the impact it is having on European OEMs, retailers and financial services. Sophisticated in-car technology and the increasingly high quality of the cars were highlighted as important factors why customers are switching from European to Chinese brands.

The following auto finance session considered the readiness of the UK as we transition from ICE to electric vehicles, following the EU’s decision to continue with their timetable to ban the manufacturer of ICE vehicles by 2040 and the UK’s timeline which remains at 2035.

Focusing on the major issues identified by the Centre for Automotive Research which need to be resolved in the ICE to BEV journey: uncertain BEV demand, BEV production capacity, new BEV processes and technologies, the optimistic panel of experts concluded that the UK will be ready for the ban on the manufacture of ICE vehicles but education is needed to change the negative view of EVs portrayed by the media along with investment in EV charging infrastructure and battery manufacturing.

In the equipment finance stream, AFC’s equipment finance community head John Rees was joined by keynote speaker Tim Biddle from Lloyds Banking Group. As we are seeing a directional change with larger UK clearing banks becoming more visible in the asset finance industry, Tim and John discussed the opportunities for big UK retail banks to focus on growth, through strategic partnerships and technology that can more comprehensively meet customer needs, and opportunities that can be derived from a more innovative approach to managing risk.

In his second session on the power of partnerships, John Rees was joined by representatives from Lombard, DELL, Lloyds and DLL, who all provided examples of partnerships which have enabled their organisations to provide strong client-facing solutions within asset finance to support the move to Net Zero – such as service and usership rather than product, moving to green assets that reduce carbon emissions, and a circular rather than linear product life cycle.

In the Asset Finance stream, Stephen Bassett and panellists looked at the findings from the recent AFC Asset Finance Unconference discussing three key issues affecting the broker-lender channel – Compliance, Technology, and collaborating to establish a commonly agreed audit review for brokers which lenders can rely on wholly or in part to replace their own checks.

The panellists discussed how these issues could be further explored and enhanced through collaboration and standardisation by the industry in order to build a resilient and efficient broker-lender channel. Simply’s Mike Randall stressed that this is about the customer, and the opportunity is to utilise collaboration and tech to improve customer outcomes.

FXE Technologies provided a case study of how AI can be used to create a digital dashboard for lending decisions. Funding Xchange’s Katrin Herrling highlighted how such technology can support the processes needed by the asset finance broker to the lender. And Philip White discussed the launch of The Broker Hub – an ecosystem to support and accelerate the growth of ambitious start-up asset finance brokers.

In Consumer Finance, the FLA’s Director General Stephen Haddrill joined David to highlight the key findings of FLA research on the future of credit, triggered by the Covid-19 pandemic and the government’s review of the Consumer Credit Act, which has the potential to transform, almost certainly for the better, the way in which the industry operates.

The FLA’s research, which highlighted the need for a consumer focus and culture in the industry, will be used to inform the debate and to provide evidence that adds weight to the feedback the industry provides to the Government in their review.

Technology sessions focused on the rapidly emerging use of generative artificial intelligence in the auto and equipment finance industry. In the Asset Finance Connect Tech Leader Presentation, NETSOL’s Eva Kellershof discussed the best use cases for ChatGPT in asset finance and how ChatGPT will enable personalisation at scale for auto and equipment finance lenders and brokers.

Specialist industry workshops

Asset Finance Connect and Shoosmiths hosted a workshop focused on the key legal and regulatory developments that the industry needs to be aware of going forward starting with the Consumer Duty implementation in a few weeks’ time. Based around an interactive case study, the workshop focused on current market themes relating to the Consumer Duty implementation landscape post-implementation, focusing on likely emerging trends.

Building on themes developed in the AFC Winter Conference Consumer Duty Workshop, the session provided another great opportunity to meet with peers from the legal and compliance community, ask questions, share ideas and build confidence in the forthcoming implementation of the Consumer Duty.

Asset Finance Connect’s AI in Auto Finance Workshop, sponsored by Alfa, also took place in a closed meeting at the conference, and was open to senior representatives from the auto finance industry to consider the use of AI to deliver better customer journeys and to increase car sales, revenue and profitability.

The Data Company’s CEO Kali Bagary concluded that the workshop was a great success and an invaluable tool for networking and sharing ideas and best use cases for the increasing use and potential of AI in the auto finance industry.

Asset Finance Connect’s inaugural Next Generation Workshop in association with the Leasing Foundation included an informative presentation from Ken Hunnisett of B Corp certified Triple Point discussing how pricing strategies can incentivise and reward social and environmental value creation.

This was followed by a roundtable session where NextGen attendees could discuss career developments, challenges and opportunities in the asset finance industry with their peers whilst gaining insight from asset finance industry leaders.

FinTech Innovator Showcase

The afternoon concluded with Asset Finance Connect’s fintech innovator showcase, sponsored by Lendscape. The four finalists pitched their company’s AI proposition to the audience and specialist judging panel, led by Steve Taplin, managing director at Lendscape, alongside Ylva Oertengren, COO at Simply and Catriona Powell, Strategic Change Manager at Novuna Business Finance.

The four finalists were:

• AI in onboarding – Toyota Financial Services entrepreneur in residence Tony Lynch discussed how AI can use browser behaviour data to predict car buying intent and how their data will help segment customers and enable better customer journeys.
• AI in manual underwriting – Andrew Martin CIO at CrediCar considered how AI can be used to predict the outcome of manual underwriting, and the opportunities and challenges of using AI to progressively automate credit decisions to reduce cost to serve and decision times.
• AI in origination – Matthew Elliott, co-founder of Nivo showed how their generative AI solution based on ChatGPT already allows customers to ask detailed questions about their finance contracts.
• AI in retention – Matt Sandom, head of sales at Automotive Transformation Group considered how AI can be used to optimise the timing and offer for auto finance customers at the end of finance contracts.

And the winner, polling the highest number of votes from the panel and also the delegates, was Nivo.

 

Asset Finance Connect’s Summer Conference was sponsored by Alfa (headline sponsor); Solifi (platinum sponsor); NETSOL Technologies (gold sponsor); Acquis Data Services, FIS, Odessa and Sopra Banking Software (silver sponsor); Bynx (registration and refreshment sponsor); Lendscape (Fintech Innovator sponsor); Shoosmiths (Legal Partner); and Great American Lease & Loan Insurance Services, LTi Technology Solutions and VIP Apps Consulting (sponsor).