Auto Finance Digital Adoption Ended Year Strong

Wolters Kluwer, a provider of professional information, software solutions and services, released results of its year-end Auto Finance Digital Transformation Index, a resource that tracks the rate at which auto dealers, service providers and lenders are seeing growth in the evolution from paper-based finance back-office processes to digital.

The digital adoption rate in the fourth quarter was essentially flat, though year-over-year fourth-quarter activity was up 21%. What’s more, the four-year trend of digital adoption is now up 129% dating back to the first quarter of 2020, indicating an industry that has significantly bought into the importance of digital adoption.

"As we reflect on the past year, the auto industry has demonstrated remarkable resilience and adaptability,” said Tim Yalich, head of auto strategy for Wolters Kluwer. “The steadfast commitment to embracing digital workflow strategies has not only streamlined the operations of many in the industry, but has also become a driving force behind their success. In parallel with the resilient activity in auto sales, our industry's digital transformation has showcased unparalleled strength over the past few years. We continue to navigate challenges with agility, leveraging technology to propel us forward. This focus on innovation and efficiency reaffirms our position at the forefront of a dynamic and evolving macro-economic landscape."

Securitization Markets' Adoption Grows

The index also shows that the digitization adoption rate for securitization markets continued. The adoption rate of monetized digital auto loans increased 325% in fourth quarter year-over-year, and the fourth quarter saw another record high of digital loan volume. The four-year trend of digital adoption shows an increase of 15%, the first time the four-year trend line turned positive. The monetization of digital auto loans in capital markets appears to be gaining strength and popularity as a means to increase capital quickly, support growth, and provide a mechanism for liquidity. 

To learn more and to access additional data insights from the Wolters Kluwer Auto Finance Digital Transformation Index visit Wolters Kluwer's website.

Originally posted on Auto Dealer Today