Auto Loans Are Killing It, And Mobile Payments May Make It Easier To Pay Them Off
Consumers have definitely regained their confidence in the economy, and that’s a great thing. A recent study from Square has shown that sales are up by 34% at its retail client bases. This very client base is the one which is using terminals, credit card readers, and more to capture payments. This confident consumer trend is also one that has gone so far as to grow into car buying.
Numbers are backing this up. According to another study, 2016 was a year where more people had bought cars than ever before in recent American history. Banks ended up issuing out bank loans like hot cakes, and many people who would have been unable to qualify for a loan in 2012 were able to do so through subprime lenders last year.
Statistics show that, by the end of 2016, Americans had $1.2 trillion in auto loan debt – a 9% increase over 2015. 20% of all loan originations dealing with cars were in the subprime category. As with many other forms of payments, lenders are beginning to think about how to make loans easier to pay off for clients.
Currently, rumors are abound that major banks are going to beef up their mobile presence. Wells Fargo, for example, has become well-known for their nifty mobile app, which allows people to check their balances, transfer funds, and also get a better idea of where their money is headed. Other banks have similar apps available to them.
Considering the new technology that bank alternative competitors have been rolling out with, many are now saying that we should expect banks to make it easier to pay off loans. This could be done through new mobile platforms with a special “Insta-Pay” feature that allows money to be securely taken out via an automated ACH service, or through approvals done in-app.
Some experts are hoping that easier payment methods may curb the amount of delinquencies on bills. By having it readily available and making it less of a chore for people to pay, many consumers may end up paying sooner rather than later. Faster loan payments may also boost profits for dealerships, lenders, and also curb issues that arise from too many delinquencies. Fewer “call-in” auto payments may also mean that lenders will be able to save money on live support.
However, it will take a while before auto loan payments will be able to be done via mobile phone – at least, when it comes to apps. In the meanwhile, retail and hospitality groups already are putting similar things into place. If you want to find out how you can use mobile payments to improve your business’s profits and client experiences, give Red Payments a call. We are here to help!