Tag Archives: Automotive

Risk & Compliance FICO @ AFSA: Auto Lenders Losing $2-3B to Fraud

Jan312017

One of my favorite movie scenes is from Blade Runner. A policeman is interrogating his detainee, asking a series of questions to determine whether the person is a real human-being or a synthetic. Funnily enough, this scene parallels the problems discussed at a FICO roundtable on ‘How to Fight Auto Loan Fraud’ held this week at the AFSA Vehicle Finance Conference & Expo. While none of the 25 attendees resembled Harrison Ford, they agreed they were getting busier looking for synthetics, just a different kind of synthetic. In this case, we were talking about synthetic identities, a type of fraud in which a criminal combines real and fake information to create a new fake identity that is used to open fraudulent accounts and make fraudulent purchases. The use of synthetic IDs in the auto loan industry has been a growing problem in the last 18 months. Attendees at the roundtable... [Read More]

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Customer Engagement Survey: To Uber or to Own? We Still Want to Buy Cars

Mar102016

“She loves me. She loves me not.” Even adults engage in versions of this classic petal-plucking exercise, particularly when it comes to owning cars. In recent years, ride-sharing services like Uber and Lyft have become global forces. Hourly car rentals are available from companies like Zipcar, and both tech companies and automotive giants are investing in self-driving cars. Is a new generation, Generation Digital – those born surrounded by technology – bringing the end of one of our longest-running love affairs, with driving? Not so fast. While the long term has yet to play out, in the short term, consumers still want to own cars. What the numbers say After years of pent-up demand during the Great Recession and slow recovery, people are starting to buy cars again. Automotive News reports that the average number of new vehicle sales per US dealership rose 4.8% in 2015 to 966 units, the... [Read More]

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Customer Engagement How Can Auto Financing Keep Pace with Market Change?

Apr292015

The auto financing industry has seen major market fluctuation over the past decade. When the recession hit and more cautious consumers deferred borrowing for new cars, auto financing sources consolidated and looked towards more conservative options themselves. 2013 saw the market start to rebound. Consumers once again became optimistic borrowers, and the industry took the opportunity to increase financing options to meet demand. For the most part, these loans have fueled strong growth for automotive financing sources. However, since subprime financing has also grown, there has been an increase in borrowers getting loans who don’t have the ability to pay. To protect profitability, auto financing sources should employ two important tactics: Identify customers likely to become delinquent and take preemptive action. By taking a proactive and analytic approach to customer management, auto financing sources can prepare for the likelihood that certain customers may go delinquent and require greater attention. Understanding... [Read More]

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