Online Auto Finance Applications Generate Higher Customer Satisfaction Than Paper Applications, J.D. Power Finds
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Maybank Ranks Highest in Customer Satisfaction with Auto Consumer Finance
SINGAPORE: 5 June 2018 — Although most customers still apply for their auto finance by filling out paperwork, these customers are less satisfied than those applying online (746 vs. 784, respectively, on a 1,000-point scale), according to the J.D. Power 2018 Malaysia Auto Consumer Finance Study,SM released today.
Two-thirds of customers who apply online have their applications approved within two business days compared with 42% of customers applying with traditional paperwork. The approval time for applications is one of the main drivers of satisfaction. Overall satisfaction is higher among customers who receive an auto finance approval within two business days than those waiting for three or more business days (784 vs. 731, respectively).
“Customers clearly prefer the 24/7 convenience of a self-service application platform,” said Anthony Chiam, Service Industry Practice Leader at J.D. Power. “However, it is interesting that there are currently only a few providers offering online auto finance applications. Moving the process onto a digital platform can go a long way in meeting the needs of customers and improving their overall experience, particularly as 82% say they prefer a paperless application process for their next auto finance product.”
The study also finds that satisfaction is higher among customers purchasing Islamic auto finance products (25%) than among those purchasing conventional auto finance products (780 vs. 749, respectively). Satisfaction among customers purchasing Islamic auto finance has increased since last year (780 vs. 758, respectively).
Following are additional key findings of the 2018 study:
- Interest rates are key when selecting auto finance provider: More than one-fourth of customers say the main reason for selecting their finance provider’s auto finance deal is because of the interest/ profit rate. This has increased by 5 percentage points from last year (21% vs. 26%, respectively).
- Financing directly vs. dealer financing: Of the32% of new-vehicle buyers who finance their purchase directly through a finance company, satisfaction is higher than among those going through a dealer to arrange financing (770 vs. 749, respectively).
- Opportunity to deepen relationship with the customer: Among customers opting for an auto finance provider that is different than their primary bank, 17% of those who are delighted with their auto finance experience (overall satisfaction scores of 855 or higher) say they “definitely would” switch their primary banking relationship to their finance provider.
Maybank ranks highest with an overall satisfaction score of 773. Maybank achieves the highest score in four of the six study factors: interaction; onboarding; billing & payment; and origination. CIMB Bank (770) ranks second and Hong Leong Bank (756) ranks third.
The study measures customer satisfaction with the products and services provided by their auto finance provider. The study measures overall satisfaction in six key factors: interaction (33%); onboarding (22%); billing & payment (17%); finance deal (10%); origination (10%); and finance advisor (8%).
The 2018 Malaysia Auto Consumer Finance Study is based on responses from 2,504 new-car buyers who financed a vehicle in the past 12 months. The study was fielded in March and April 2018.
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About J.D. Power in the Asia Pacific Region
J.D. Power has offices in Singapore, Bangkok, Beijing, Shanghai and Tokyo that conduct customer satisfaction research and provide consulting services in the automotive, information technology and finance industries in the Asia Pacific region. Together, the five offices bring the language of customer satisfaction to consumers and businesses in Australia, China, India, Indonesia, Japan, Malaysia, Philippines, Taiwan, Thailand and Vietnam. J.D. Power is a portfolio company of XIO Group, a global alternative investments and private equity firm headquartered in London, and is led by its four founders: Athene Li, Joseph Pacini, Murphy Qiao and Carsten Geyer. Information regarding J.D. Power and its products can be accessed through the internet at asean-oceania.jdpower.com.