It reveals that 39% of all online applicants are approved by prime lenders. This is better than most other online prime financial services channels and is only slightly below the industry average for showroom visitors of around 50% from a dealer’s principal lender.
Drilling down into the detail, it is interesting to note that the picture varies quite widely from dealer to dealer. Using Equifax’s Risk Navigator RN04 credit score, 77% of online applicants to all dealers score more than 200 – the usual minimum level for non-prime - and 36% more than 350 – seen as the prime typical benchmark - where an average APR of 10.8% is being quoted.
But this improves considerably for a prestige dealer group quoting an APR of 7.9% with 92.5% being scored at more than 200 and 70% at more than 350.
Certainly, the high level of scoring for applicants to prestige dealerships where there is an attractive finance offering means that any business operating in that sector that is currently not providing online finance is missing an important opportunity.
Also, we are seeing some evidence that the quality of applicant is improving over time as consumers become more comfortable with the concept of online motor finance and being pre-approved for their preferred vehicle. They also appear to be gaining aptitude in using the online tools now available to help them find the finance product that best fits their needs.
On top of our findings previously that 65% of the top 200 dealer groups now offer online motor finance, these figures show how quickly it is becoming a crucial feature of the market.