Auto finance business processs- Part2

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This post is in continuation to the previous post on auto finance business processes. 

Contract servicing in Auto finance can be broadly classified into 3



Collections -

All activities that involve collection of payments come under this. Based on milestones there are different process that happen. 
  • The initial milestones involves informing the client of the missed payment through SMS, e-mail and phone sequentially. 
  • If the client doesn't make payment even after the next milestone a home visit by the collections team to remind the customer about the money. 
  • At the next milestone the client will be offered a restructured loan that would be a more favourable one. 
  • The subsequent milestone requires a staff to meet the client and then try to retrieve the overdue amount. 
  • If the client still does not pay, it would considered that the client is refusing to pay and that the client is not honouring the contract. The client would be considered as rogue. 
  • The next step of actions for the subsequent milestones would be repossess the vehicle and the client asked to pay the remaining amount. 
  • If the remaining amount is less and the client is not paying up, the collections team will attempt to write off. Only the processing charges will be asked to the client. 
  • If none of the above steps are working, recovery process for the vehicle will be started and retrieval of vehicle would happen. 
  • On unsuccessful attempt, legal proceedings are initiated against the client.



Customer Service-

All activities that help the customers in matters related to their contracts and their details come under this. The various process that come under these are-

  • Changing Business Partner Details like borrower, co-borrower or guarantor. Changing from Individual to Company. Change of address, phone, email etc.
  • Refinance and Extension of loans if the customer is unable to service the loans. Other finance products like balloon finance, extension of loan, new line of credit etc. are provided
  • Changing the asset details like vehicle number and repair etc.
  • Fund transferring for servicing the loan and refunds in case of any discrepancy
  • Waiver of overdue and penalty at the discretion of the finance manager based on the clients financial health and track record including their credit score
  • Termination of Contract- this includes contract closing, early termination, partial closure
  • Claiming of insurance
  • Request for documents like Rental Plans, Payout certificates, repayment certificates, Payment details, Vehicle invoice, Mortgage certificate etc



Re-marketing and Resale-

This is the process of selling the vehicle to the customer or acquiring the vehicle after lease. The processes can be segregated to Pre-Term and Post-Term. Pre-Term has Pre-Inspection and Intention capture at the end of term. Post-term has Grounding, Pricing, Bidding and Post-Sale.







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