Perhaps finance providers that do not have as much margin for risk as other market players see businesses as a safer bet than consumers in the auto-finance space.
New analysis from White Clarke Group that looks ahead to what might happen in 2018 showed that the re-emergence of small and regional banks looking to expand services to existing manufacturers, dealers and retailers is continuing to spur growth in the floorplan finance market.
White Clarke Group reasoned that this trend is providing opportunities for many traditional finance companies and other lenders looking to diversify their businesses and expand into wholesale, with growth expected to continue throughout the year.
Kurt Ruhlin, chief operating officer at White Clarke Group, emphasized that finance companies also are fast realizing that the necessity for the right system partner to help them get to market quickly with low operating costs is imperative.
Ruhlin insisted the key is finding a scalable solution that can provide an economical yet reliable, future-proof system to fit both the current size and growth of their businesses.
“We have seen a surge of expansion in the market and a need to increase operational efficiency,” Ruhlin said. “As a result, many new or expanding wholesale lenders have selected the CALMS Compass wholesale platform to fulfill their needs.
“The need for a quick to market system has become critical, and the out-of-the-box functionality has allowed for many new implementations to go from decision to live in less than 90 days,” he continued.
Ruhlin went on to note that new compliance and regulatory requirements are also playing a pivotal role in the emergence of start-ups, small companies and manufacturer captive lenders, which find it easier to raise capital due to their flexibility.