Mobile Auto Loan Apps Are Key to Consumer Satisfaction

A growing number of auto loan customers are using smartphone applications to interact with their lenders, according to a J.D. Power survey of nearly 14,000 auto loan and lease customers.

The survey, released this week, indicated overall satisfaction is high among customers currently using auto-finance apps, with nearly half — 47% — of auto loan customers shopping online for vehicle financing prior to visiting a dealership.

Highest levels of satisfaction occurred when applications were user-friendly, intuitive and provided users with the capabilities they desired most.

“We asked a number of questions related to what they would like to have in a mobile app, those were the ability to schedule automatic bill pay, a calculator to figure out payoff, an account alert, vehicle service offers, email address to customer service, and credit applications,” report author James Houston told TU-Automotive.

Houston explained that as more lenders move into the mobile app realm, adoption of mobile and web-based apps would increase.

“Overall adoption will increase whether more lenders offer the service or not, because consumers who grew up with mobile phones will want that to be offered, and will just go with whatever lender is offering that service, be it their second or third choice,” he said.

Based on a 1,000-point scale, overall satisfaction scores were highest among customers who secured direct financing outside the dealership — 867 — and among those who shopped ahead of time but selected the dealer-offered option — 857.

Among the 23% of respondents who completed a digital loan application, using a website or mobile app, overall satisfaction scores were 55 points higher than among those who complete an application with traditional paper or verbal means — 884 points vs. 829 points.

Among automakers, Lincoln Automotive Financial Services and Mercedes-Benz Financial Services ranked highest among luxury brands, with both companies tying with a score of 877. GM Financial, with 867 points, ranked third.

The study measured overall customer satisfaction based on five factors, including billing and payment process, the mobile app experience, the onboarding process, the origination process and the website experience.

The report revealed that when loan customers use a combination of website and mobile app for all facets of the loan application, onboarding and payment process, mobile app accounts for 32% of the overall satisfaction score, making it the single-largest factor in the customer satisfaction equation.

Houston also noted that while the study did not measure risks and mobile app security, experience would indicate auto loan providers require the same level of security and protocols that financial institutions employ to insure secure transactions and protect customer data and privacy.

“If I’m going to give you information that is related to me from a credit perspective, I better understand the security you have around the app,” Houston said. “The astute customer who understands the propensity for credit identify theft will want to make sure those protocols are in place. We think a standard practice would be to follow the major financial institutions that have those in place.”

— Nathan Eddy is a filmmaker and freelance journalist based in Berlin. Follow him on Twitter @dropdeaded209.

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