CONSUMER & ASSET FINANCE & LEASING
Consumer and Asset Finance and Leasing businesses are often covered by the generic term: financial services providers. Such a definition seriously understates the complexity of such businesses or even the level of diversity of the product offerings.
The diversity of this specialist sector covers:
- regulated or unregulated business;
- complex and variable accounting standards for both operators and customers alike;
- businesses who effectively generate revenue through selling interest rate variation through to those who have serious and detailed asset management expertise and know how to generate revenues therefrom;
- organisations who distribute their products/services directly to the market with others who effectively feed off (indirectly) alternative distribution arrangements (e.g. motor dealers);
- a complex range of contractual and product designs;
- businesses that are ‘captive’ to non-financial product operations and whose existence is to simply provide customers with an alternative procurement route to outright purchase; and
- operations based on ‘asset finance’ and ‘leasing’ where the underlying asset can vary from a complex industrial plant/jumbo jet to a simple photocopier.
Despite the diversity, businesses in this specialist sector have many things in common, i.e.:
- high levels of capital requirement;
- similar taxation and accounting regimes;
- levels of governance and compliance;
- the need to have expertise in similar areas, such as : asset management; credit and risk assessment, technology, human resources, funding lines, systems and process; and often
- associations with other vendors and/or distributors of the underpinning assets
As a result of these similarities, many businesses in the sector have common infrastructures and perhaps more importantly problems and opportunities. This consistency means that know-how, expertise and experience about the key success factors are transferable without cutting into ‘asset based expertise’.
Whether the business operates in the mature markets of the Western world or the developing and emerging markets of Asia, the Middle East and Africa, or South America, the key success factors/dynamics for a consumer or asset finance or leasing business are often identical or similar. This is where Aisby can help and advise.