Irish fintech start-up peels away the layers of car finance

Peeled Finance, an Enterprise Ireland-backed fintech start-up, is set to enter the €4 billion per annum Irish car finance market in 2019 with the launch of a digital platform that will make it easier for consumers to source finance when purchasing a new or used car.

The innovative finance solution can serve both consumers directly and as a white label platform for businesses interested in participating in the car finance market without investing in infrastructure or setting up as a lender.

“This means that an EU based bank which doesn’t currently offer secured lending for car finance now has a 100% digital, cost-effective means to enter the market. Likewise, insurance companies and auto-industry players—such as car search websites—will be able to offer car finance to their customer base via a simple button on their websites. Risk is minimised in that the finance product is secured on the car while the Peeled platform validates customer inputs, carries out income verification, fraud checks and handles anti money laundering requirements without the need for physical documentation,” explains Chief Executive Nigel Rutherford.

The Irish launch in early 2019 is the first step in a roll-out which will see Peeled Finance replicate its partnership model to expand into the €250 billion per annum EU car finance market.

The target consumers are computer-savvy, regular online shoppers. Peeled Finance taps into the desire for a simplified experience where paperwork, phone calls and branch visits are replaced with a mobile-first, end-to-end purchasing experience. As well as simplifying and streamlining the car finance application process, the platform provides an array of value-added features such as vehicle valuation and history checks aimed at empowering the consumer.

The technology aspect is key as Peeled Finance fulfils the entire car finance journey online. This is critical at a time when mobile-first, always-on, digital purchasing experiences are growing in popularity. The average car buyer does eight hours of online research and uses a large number of sources to find out about cars and view potential purchases but, up to now, consumers seeking car finance have had to either apply for a car loan from their bank or credit union, or wait and go through a face-to-face car finance application process on the forecourt. Peeled Finance brings car searching and financing closer together in an always-on, easy-to-use, conversational-style interface where consumers provide information in a more intuitive, screen-by-screen way, and receive immediate feedback on, for example, the history and value of the vehicle they want to buy.

As the customer progresses through the early part of their car finance journey, the platform validates the vehicle make, model, age, spec and history. It checks that the car value is within an expected range, and that there is sufficient equity in the vehicle. To satisfy anti money laundering requirements, the customer simply takes a photo of their driving licence and a selfie, and using open banking can share- without paper documents- their bank statements. Before finalising the contract, the customer will have refined their car purchase decision to the point where the registration and mileage for the car they are buying is known, the trade-in value agreed, and the details confirmed by the car dealer. An agreement document is generated which the customer can sign on their mobile phone. Once the contract is in place, the dealer is paid electronically and the customer is notified that they can collect the car. Transparency is built into the platform with explanations of ‘how it works’ and ‘why information is needed’ provided at every step of the journey.

Following the Irish launch, Peeled Finance has ambitious plans for the UK for later this year, with further expansion into the EU car finance market already in its sights thereafter.

This article first appeared in the Sunday Business Post on 13th January 2019.