Platform Finance – Broker Central Resource Centre

During this unprecedented time, we want you to know that the team at Platform are here for our brokers and their customers.

We are working hard behind the scenes to collate all information and resources you may require from the Government and Finance Companies as there is, and will continue to be, a significant amount of information for you to keep on top of for your clients.

Our Broker Central portal will be your central point for this information. We are updating Funder Bulletins as they are received, which you can locate by selecting the funder in the Finance Partners tab. Additionally, on Broker Central, we have created a dedicated section to be your Resource Centre throughout this time.

broker-Central

Broker Central – Resource Centre

  • Links to updates from the Government pertaining to economic stimulus packages that are important for your business and clients – most importantly on SME funding guarantees
  • Funder contact information pertaining to hardship
  • Funder information pertaining to payment deferrals

Financier Contact & Webinars

We are working closely with our funders to provide you with up-to-date information and in the coming weeks, we will invite you to remotely connect to webinars from select funders.

This will enable interactive and dedicated time for you to gain access directly to the funder to understand where and how they’re continuing to support lending during this time.

Haven’t activated your access?

If you don’t have access to Broker Central, please contact us and we can contact you about getting access.

Please continue to visit the Resource Centre in Broker Central on a regular basis, as we will continue to provide updates and assistance via this channel.

Visit Broker Central

If you need further information, please don’t hesitate to contact us. We are here to support you.

Would you like to Partner with Platform?

If you aren’t an accredited Broker with Platform Finance yet, it’s easy to join the team.

Contact us today – Partner with Platform.

Electric vehicles in Australia on the rise

The electric vehicle market has exploded in Australia. And with reduced prices and more choice than ever, many car buyers are now starting to consider them alongside mainstream options. In recent years, we’ve also seen more manufacturers throwing their hat in the ring, so there’s only exciting times ahead for this up-and-coming vehicle class. And that can only be a win for consumers.

 

Types of electric vehicles

The current electric vehicles are mostly suited to those who drive short distances. This is due to battery power and charging needs. Getting suitable power and range for longer distance driving is becoming available in the more expensive electric vehicles such as the Tesla. Charging time can vary depending on your power source and the size of your battery. You’ll find it slower at home using mains power than using a dedicated charging station.

Hybrid

These vehicles combine a standard engine with an electric system. The battery is replenished by electricity generated by the vehicle’s braking system. Some batteries may also be recharged by the engine while it’s running.

Plug-in hybrid electric (PHEV)

This type of vehicle also combines a standard engine with an electric propulsion system. However, the battery can be recharged using power at home or charging stations.

Electric (EV)

Run entirely by an electric motor, there is no safeguard of a standard engine in these cars. These vehicles need recharging at regular intervals.

 

Why do buyers choose electric vehicles?

There are several reasons why a driver may choose an electric or hybrid-electric vehicle.

  • Lower emissions
  • Energy efficiency
  • Reduced running costs
  • Minimal maintenance costs

Generally, the price and performance of electric vehicles has been a hurdle for buyers to overcome. And up until recent years, it was difficult to find charging points in public areas – a necessity for those travelling longer distances from home. All these factors are improving exponentially, making the electric vehicle a viable option for many car buyers.

 

Who is manufacturing electric vehicles?

You’ll find cars from Hyundai, Mitsubishi, Nissan, Renault, Jaguar, Toyota, and Tesla available to purchase in Australia. And many of these manufacturers are offering several options in their range to appeal to a wider range of buyers.

 

Financing electric vehicles

Some electric vehicles may be eligible for interest rate discounts such as the one offered by Metro Finance for commercial buyers. Their Green Vehicle Finance Initiative rewards investment in energy efficiency.

If your customers are considering an electric vehicle for their next purchase, we’ll help you find a suitable financing option. Get in touch with us today.

Car loans through a bank versus a dealership versus a broker

When you need to search for something online, you Google it, when you hurt your leg, you stick a Band-aid on it, but what’s the first thing that pops into your customer’s mind when they need a car loan? Do they go to a dealership, bank or go to a Broker?

Below we unpack the differences of each option to help educate your customers:

 

Time Pressure

A dealership has the car in stock and they want to sell it ASAP. So it might seem like keeping the process in the one place would make sense to get the deal done quickly. But due to changes passed down by ASIC on November 1, 2018 regarding risk based pricing and changes to a dealership’s remuneration model previously known as Flex Commission, the time it takes to obtain car finance from a dealership is now exactly the same as processing a car loan through a bank or a broker.

 

Choice

If your customers like choice, dealership finance is limited. Remember a dealership usually has only one or two lenders available to choose from. This can lower the chance of approval or receiving competitive finance options. Sometimes we even see an increase in the vehicle purchase price or a change in the trade-in price offered, to offset the lower finance option presented to a customer – this can be confusing!

 

Compliance

As it currently stands, the Point of Sale exemption is legislation existing to allow dealerships the ability to offer finance on vehicles they are selling without the need to hold an Australian Credit Licence. The Hayne recommendation as part of the Royal Commission, has been put forward to remove this ability for dealerships to offer finance without meeting appropriate licencing requirements. This has been supported by both sides of government and is expected to pass through unchanged. We know all brokers must operate under a credit licence when presenting finance options to customers, so this is the perfect time to articulate the benefit of using a broker over a dealership. Compliance is extremely important, and as it stands, only a handful of dealerships in the entire country hold a credit licence!

 

Price

Surprisingly, we still see a number of finance offers from dealerships without all fees and charges listed on quotes. Or, there has been no written quote provided as only the interest rate was shared verbally. Due to risk based pricing on all consumer car loans now adopted by all lenders, the only way to truly compare apples with apples is to see a quote in writing after a risk based assessment has been completed. At a dealership, this often happens towards the end of the transaction, where figures can change significantly once a lender understands the overall profile of the applicant. As a broker, we help you with the risk assessment up front, removing the chance of a nasty surprise before collecting the car.

 

Car loan through a bank

Similar to customers going directly through a bank for a home loan, choice and assistance are key reasons why customers choose a broker for their next car loan. A bank may only have one option for a customer, versus a broker accessing our panel of over 40 lenders.

When discussing the options for your customer’s car loan, the second biggest purchase that they are likely to make, it is important to share the key differences outlined above. This helps ensure they understand the benefits of using a broker over a bank or dealership for their next car purchase. There have been a number of changes to the industry and the options available over the past 12 months, and likely since your customer’s last car purchase. If you need further assistance with articulating this message, make sure you reach out to your BDM.

Which fuel type do I need for my car and what’s the difference?

What type of fuel do I need for my vehicle?

Understanding the different types of fuel available in Australia can be confusing for many drivers. Most service stations now carry their own branded and named fuel, each with varying claims of quality and performance. Here’s a quick roundup of what it all means.

 

What fuel types are there?

Liquefied petroleum gas (LPG) – This fuel has been historically cheaper than petrol, but also has lower fuel economy. LPG was popular among drivers due to a government incentive to transition existing petrol engines to gas. It’s no longer popular due to higher prices and removal of the government incentive.

Petrol – This fuel type covers a wide range of options available to drivers. These include regular unleaded, premium unleaded, and ethanol options. Regular unleaded is one of the most common fuels used in Australian cars.

Diesel – Often associated with commercial vehicles, diesel engines offer better fuel economy than petrol engines. Car manufacturers are now selling diesel alternatives for many standard passenger cars.

 

What do the numbers mean?

The fuel options available for petrol-powered cars are often differentiated by a number. These numbers relate to octane levels in the fuel which can contribute to vehicle performance. You may see 91, 95, or 98 in the unleaded range. This number represents the ‘research octane number’ (RON). Regular unleaded is usually 91 or 93, and premium is 95 or 98. E10 fuels include 10% ethanol blended with standard unleaded petrol. Ethanol blends may not be suitable for some vehicles.

 

Do I need additives to improve my fuel?

There are a range of fuel additives on the market that claim to clean your engine and injectors, improve your engine’s performance, or have a positive impact on fuel efficiency. If you have a standard passenger vehicle and you stick to the servicing schedule, it’s unlikely you’ll need to include additives when fuelling up. If you have a high-performance vehicle or an older car, there may be some benefit in using additives. However, it’s important to seek expert advice first as the wrong additives may have a detrimental effect on your engine.

 

What happens if I choose the wrong fuel for my vehicle?

Filling your tank with the wrong fuel, such as diesel instead of petrol, can be disastrous and expensive. This is especially the case if you start your car without realising what you’ve done. It can cause considerable damage to your engine. If you notice your mistake prior to starting your car, it will be an easier fix. Your mechanic will just need to drain the fuel tank and flush the fuel lines. And once you fill the tank (with the correct fuel), you’ll be good to go. Most car manufacturers put a label or sticker on the fuel flap to remind you what type of fuel you need, so it’s always best to check first.

Ute Sales Dominate in September

Consumer behaviour surrounding car buying is changing. No longer are we seeing passenger cars as one of our highest selling car segments. According to the Federal Chamber of Automotive Industries (FCAI) September VFACTS report, three Utes dominated the new-vehicle sales list.

When combining 4×4 and 4×2 variants, Toyota Hilux, Ford Ranger and Mitsubishi Triton were the best-selling models last month. Toyota Corolla and Hyundai i30 went backwards in sales for September 2019 and Mazda 3 dropped out of the top 10 completely.

Top 10 Best Selling Vehicles in September

  1. Toyota HiLux – 3364 (down from 3674 in August 2019)
  2. Ford Ranger – 3116 (down from 3181)
  3. Mitsubishi Triton – 3001 (up from 1755)
  4. Hyundai i30 – 2447 (down from 2813)
  5. Mitsubishi ASX – 2419 (up from 1728)
  6. Mazda CX-5 – 2355 (up from 1797)
  7. Toyota Corolla – 2219 (down from 2863)
  8. Kia Cerato – 2022 (up from 1686)
  9. Nissan X-Trail – 1769 (up from 1743)
  10. Toyota RAV4 – 1716 (down from 2006)

With this trend towards 4×2 and 4×4 vehicle purchases, we have noticed an increase in self-employed customers as opposed to PAYG. We are also noticing this is resulting in an increase on the average amount financed. In essence, businesses are looking to invest in new assets to grow their business, so now is a great time for brokers to approach their commercial clients and assist them with their vehicle and equipment finance needs. Strike while the iron is hot!

Competing with dealerships on finance offers

We are heading into the traditional “Plate Clearance” sale period, so dealers are pulling out all the stops to get customers in the showroom doors to clear 2019 stock, including offering low interest rate finance deals.

Plate Clearances relate to the date stamped on the car’s build plate, which tells us when the car rolled off the production line. This shouldn’t be confused with the compliance date, as compliance usually determines the model year of a car when new. It is the build date that a car will always be valued by down the track.

Quite often there will be no difference between cars built either side of New Year’s Day – for example, a Toyota HiLux built in October 2019 might sell on the same day as an identical car built in February 2020, however it will always be defined as an older car because of its build date.

This does have an impact on depreciation and resale value, so it’s important you prompt your clients to ask for the build date when researching their next car purchase.

We find new car buyers generally want a car built in the same year, so right now the focus for dealerships is to clear stock before the New Year – making November and December a great time to negotiate.

Another common marketing approach we see at this time of year, is the “0% car finance” or “1% interest rate” offers. And as the saying goes, if it sounds too good to be true, it usually is. The fact is that 0% finance on new cars can often be more expensive to buy than the same car bought with a standard finance interest rate.

Here are some tips so you can help educate your customers on the pitfalls of dealership car finance offers, and remember to ALWAYS read the fine print!

  • Check how much the total repayments will be over the life of the loan, and for the breakdown of all fees and any other charges.
  • Check if the offer is only available on selected make/models, and specific colour options, and if the price of the car is negotiable.
  • Always compare the car and finance offer in the dealership with those available from our 40+ lender panel. We can often find a better deal that is tailored to suit your client’s needs.
  • Check the build date of the vehicle as mentioned earlier.
  • Check the length of the loan. Many low interest rate offers are only available over three years, and the monthly repayments may be higher than a regular interest rate over a longer-term loan.

If you have any specific car finance scenarios, please contact our Broker Support Team for advice and quotes. The End of Year Plate Clearance sales are a great opportunity for you to touch base with your clients about upgrading their car, as there can be some great deals available this time of year.

Major opportunities ahead for asset finance – but more compliance awareness needed

Australia’s asset finance sector is expected to grow substantially in coming years, with brokers set to reap the rewards – but compliance needs to be a key area of focus. That’s a key take-away message from the recent Asset Finance Broker’s conference, held by Consolidated Operations Group, Australia’s largest broker and aggregator group in the asset finance space, with net asset finance of $4.24 billion per annum.

The conference is the country’s largest asset finance broker forum, open to brokers from the Platform Finance, Centrepoint Finance and Consolidated Finance Group. This year was the third time the conference has been held and was the biggest one yet, with over 190 delegates attending.

“This year’s conference was a huge success and we covered a range of factors impacting the sector,” says Brad Crinion, CEO of Platform Finance, Australia’s leading asset finance services partner and a part of Consolidated Operations Group Ltd.

“The outlook for the next 12 months and beyond looks very positive, particularly because of strong government spending. There are many opportunities being created by federal and state governments’ commitment to upgrading infrastructure in coming years. This will create work for commercial contractors who need asset finance to grow.”

In light of the post-Royal Commission environment and changing banking regulations, Crinion says compliance was also a key topic covered at the conference. “One message that came up time and time again was how brokers and lenders need to make consequence management more of a priority,” he says.

Steve Ritchie, Head of Compliance with Platform Finance and a member of a panel that discussed compliance at the conference, says “consequence management measures are being more strictly applied now than ever”.

“In years gone by, a broker may have received a ‘slap on the wrist’ for doing the wrong thing,” he says. “However, in the current regulatory environment, there is an expectation from the regulator that acts of non-compliance are dealt with accordingly and the consequences applied to a broker are much more severe.

“As an industry we need to do more. And while major banks and lenders are starting to do more in this space, brokers need to have greater awareness of their obligations, how to fulfil them and what the consequences could be for any inadvertent or deliberate breach of compliance. That could include cancellation of accreditation, fines or industry bans,” he says.

Ritchie recounts the story of a broker whose accreditation was recently cancelled because of fraud. “The broker was under pressure to get a deal settled and when the lender requested changes be made to an accountant’s letter to facilitate settlement, the broker modified the letter himself and submitted it to the lender. When questioned by the lender, the broker blamed the customer for modifying the document. The end result was that the broker’s employment was terminated, his lender accreditations were cancelled, and he was permanently banned by the aggregator.”

The upshot, Ritchie says, is brokers need to be more aware of their obligations. “Whereas sales teams used to be the force behind many lenders, in most instances now it’s the compliance, legal and risk teams that are ‘running’ the business. However, brokers shouldn’t just assume any issues will be picked up by lenders; they need to change their mindset and understand they are the first line of defence and have an obligation and duty to themselves, their aggregator, the lender and the customer, to submit applications that contain accurate information reflective of the customer’s circumstances.

“Further, brokers should keep detailed file notes of their conversations with customers and evidence to demonstrate certain disclosure requirements were met. In the absence of file notes and evidence, it becomes very difficult to prove to the likes of AFCA (in the case of a customer complaint) or ASIC that regulatory obligations have been fulfilled,” adds Ritchie.

Ritchie says he’s noticed an increase in fraudulent activity in recent months. “The broker world is an easier target because of their business models. The majority of their transactions occur over the phone or via email,” he explains. “There’s a real need for brokers to exercise additional due diligence and not simply accept the information provided by the customer is accurate.”

Ritchie says some of the main types of misrepresentation in finance applications include:

  • Falsified pay slips
  • Falsified rates notices or utility bills
  • Fake driver’s licences

To help brokers meet their obligations, the group is producing e-learning modules, videos, lender training programs and tailored training sessions, in addition to providing a monitoring and supervision program to help ensure regulatory obligations are met. Platform Finance has also launched a new system with automated compliance controls.

“We are really excited by this new asset finance CRM,” says Crinion. “We’ll be revealing more in coming weeks but put simply, it will help revolutionise the way brokers manage and process applications daily.”

Adds Ritchie: “We are trying to automate as much as possible and take compliance out of brokers’ hands.”

Find out more about Platform Finance and partner with us today.

Australia to mirror US car-buying trends

Major study finds US buyers do not rate TV or Facebook in decision on what car to buy

Buyers are increasingly frustrated with shopping for new vehicles – citing a dislike of negotiating prices and filling out paperwork – and are spending more time searching for vehicles online, less time at the dealership and do not rate television in their purchase decision-making.

The Cox Automotive US Car Buyer Journey survey released earlier this year found that television advertising is unlikely to sway buyers to a new brand, that people are less likely to visit a dealership, that used cars are increasing in sales compared with new cars, and that social media – including Facebook – is one of the last methods used to actually choose a car.

Cox Automotive vice-president of research and market intelligence, Isabelle Helms, said the latest study found that online tools are helping buyers but that more work needs to be done to improve the car-buying experience.

“At the dealership, filling out paperwork and negotiating a price remain top frustrations for most consumers,” she said.

2019-Cox-Automotive-Car-Buyer-Journey-New-Vehicle-Buyers-Infographic

RESEARCHING ONLINE

The study found only 39 per cent of car buyers believe the process has improved since the last time they bought a car and that fewer than 10 per cent of car buyers are negotiating a price online or filling out paperwork remotely. Both results are seen as indicators that the industry still has ample room for progress.

“However, we found that consumers are spending more of their shopping time online while making faster decisions and spending fewer days in the market,” Ms Helms said.

“Car buyers spend an estimated 61 per cent of active shopping time online – up from 57 per cent in 2017 – and are in the market for an average of 96 days, a drop of more than 20 days in the past two years.

“What’s more, about 50 per cent of used-car buyers and 44 per cent of new-car buyers are now spending 30 days or less in the market.”

Cox Automotive Australia and New Zealand CEO Rob Whiten said that while we are behind the US in a number of areas in terms of the car-buying process, for example digital retailing, “there can be no doubt that both dealers and manufacturers in Australia can benefit from the very interesting findings”.

 

DEALERSHIP VISITS

The survey found that the number of dealerships visited in the car-buying process also continues to drop. On average, car buyers who purchased from a US dealership visited 2.3 dealers. In 2017, the survey showed the average buyer visited 2.7 dealerships.

Now, 41 per cent of buyers visit just one dealership during the car-buying process, up from 30 per cent in the 2017 study.

“Buyers who negotiate and complete their required paperwork online are notably more satisfied with the buying process, as are those who spend less than two hours total at the dealership,” the authors said.

“Completing paperwork and negotiating a final price are the top frustrations with car buyers today.”

 

ONLINE TOOLS

But the number of people using online tools for car purchases is still low. The survey found that less than 10 per cent of vehicle buyers report negotiating the final price of their new vehicle online, and only five per cent filled out all the required paperwork.

Yet consumers who negotiated online or completed paperwork online spent 45 minutes less time at the dealership and reported being more satisfied with the dealership experience.

The 2019 Car Buyer Journey shows car buyers are spending an average of 13 hours and 55 minutes researching and shopping for a vehicle, down from 14:44h in 2017.

 

ADVERTISING vs WORD OF MOUTH

“Only 10 per cent of vehicle buyers trusted social media sites such as Facebook to help with their final decision on a vehicle brand,” the authors said.

When it comes to what brand they choose, the survey found that about one-third of new-car buyers ultimately choose a brand they have never owned before, with their decision mostly driven by product attributes and the deal offered.

Television advertisements rated poorly as the source of choosing a brand.

The survey concluded: “In courting new-vehicle buyers, automakers focused heavily on traditional television advertising are mostly wasting their time and money.

“Only 13 per cent of new-to-the-make buyers became aware of the make through television advertising.

“Word of mouth from friends and family is the most cited source of influence, followed by the internet, where third-party sites are the top driver of awareness.”

 

Credit: GoAuto.com.au

How to build a referral network

Referrals can be a powerful way to bring in new leads to your business and deepen your relationship with other business professionals. Building a referral network is how you can make this happen.

Here are 3 easy ways you can start building your referral network today.

  1. Consider your existing business relationships

As a finance broker you may already have business relationships with accountants, solicitors, marketing consultants, real estate agents and a host of other professionals. Taking the time to chat with them about starting a referral relationship can be a great way to begin building your network. And most business owners and professionals are keen to extend their referral networks. You’ll need to agree whether it will be a formal arrangement where fees are paid for each referral, or an informal one where you both share referrals with no fee.

  1. Join a referral group or your local chamber of commerce

Your local community is one of the best places to build your referral network. Joining your local chamber of commerce or attending their events can provide a great way to connect with other professionals. It’s important to focus on building genuine relationships with professionals in industries that will complement what you do. There are also formal referral groups in most towns or cities that accept new members. They include BNI, The Referral Network and Business Referral Group.  Most of these formal referral networks require a paid membership to be part of the group.

  1. Don’t be shy with your friends and family

No one likes a pushy friend or family member asking for business, but sharing stories about how much money you saved a client, or the rare piece of machinery you recently financed, can be a good lead in. By making your stories interesting and relevant, your friends and family will want to know more about your business. Once they get to know how you’ve helped others, they could be your biggest advocate.

Your referral network can quickly grow with a bit of commitment and investing in building genuine relationships with other professionals. A warm lead is a great way to start a relationship with a new client. It also means you’re adding value to your current clients by offering recommendations for help they might need.  You’ll soon realise which referral relationships deliver the most value, and you can spend more time focusing on these.

5 reasons to get your clients pre-approved for a loan

Looking for ways to encourage your clients to get pre-approved for a loan before they make their next vehicle, equipment, or machinery purchase?  Planning in advance for major purchases can have significant benefits for buyers.

Here are 5 reasons why pre-approval is a great idea for your clients.

Allows your clients to set a budget

A pre-approval provides your client with a maximum loan amount they can borrow for a new purchase. This allows them to set their budget in advance and know what they can spend on their new vehicle or equipment. It helps them find options that are suitable for their needs and their financial situation.

Identifies any credit problems early

Identifying potential credit problems at the start can save your client time, stress and frustration in the long run.  By doing this early in the purchase journey, you can also help your client create a plan to fix any credit problems. This helps to strengthen their financial position before applying again.

Gives your client confidence

Your client will feel greater confidence knowing they can afford the vehicle or equipment they’re considering. They’ll present as a serious buyer and will be less likely to be persuaded to consider unsuitable options.

More power to negotiate

In addition to the confidence boost, a pre-approval gives your client more power to negotiate their purchase. It’s a great way to show that the buyer will proceed if the price is right. A salesman is always keen to hit their sales target and know that buyers can shop around too. This provides added incentive for them to give your client a better price to secure the deal. Your client may also be able to negotiate free extras or upgrades on their purchase.

Avoiding dealership finance

If your client has gone through the pre-approval process, they’re less likely to choose dealer finance at the time of purchase. This is a big win for you. Dealership finance is often more expensive than finance options you can provide, which means the client saves on their repayments too.

Discussing these benefits with your clients will add value and show you’re considering their best interests when it comes to financing their next vehicle or equipment purchase.