Standard Bank has appointed a new Head of Vehicle and Asset Finance, Simphiwe Nghona. a former chief executive of the Motor Division for WesBank SA. He has 18 years of experience in the automotive and banking industries. This appointment is viewed as standing him in good stead to grow Standard Bank’s VAF division and to further improve customer and dealer experience. We decided to gain some insights from Simphiwe via a Q&A:
Is it fair to say that vehicle sales [especially new vehicle sales] during 2017 have been surprisingly robust after a sluggish 2016? If so what do you regard as the most important factors?
Simphiwe: The slowdown in vehicle sales in recent years was anticipated to turnaround, which it did towards the end of 2016. Vehicle sales during 2017 have been in line with what we had expected, given stable inflation and low interest rates, despite low GDP growth.
Would you say that there is a substantial gap in buying power between the haves and have-nots…? Do we have a strong enough “middle class” of buyer between the low cost and higher end salary and affordability brackets?
Simphiwe: There may be a gap in buying power between customers in the highest and lowest affordability gaps, however we have robust new and used car markets, that ensure that there are vehicles in all price ranges, that cater to consumers across the spectrum. There is evidence of middle class demand in that we see the vast majority of deals are between R100k and R300k.
Do you believe that the average person [Joe Public] has a sufficient knowledge about vehicle finance or should we do more to educate?
Simphiwe: There is a need to further educate consumers about vehicle finance, particularly regarding affordability and interest rate implications, as well as all other costs relating to the vehicle purchase and financing. It is key that finance houses partner with dealers to provide this education.
How can Standard Bank in your mind use technology to enhance the vehicle buying and financing experience?
Simphiwe: The digitisation of the vehicle financing experience is very important to enhance the value that our customers get from us. Particularly, how customers interact with us when they are in the market for a new vehicle. Being able to give lightning quick responses regarding approvals to the customer, wherever they may be, is where we need to get to. We have already made progress with how our customers interact with us via our mobile banking app, by keeping track of their outstanding balance and requesting of settlement letters. There is also great opportunity in being innovative in solving our customers needs. As always with technology, there is always room for improvement.
How important is the relationship between the bank and the vehicle retailer – has technology and online vehicle platforms had any impact on how financing strategies?
Simphiwe: The relationship between the bank and the vehicle retailers (and vehicle manufacturers) is of significant importance with the customer at the centre of all we do. All improvements have to be focused on enhancing the customer experience. Technology continues to be a major influencing factor in evolving financing strategies and interactions between the bank and retailer. The value our customers get from this is our primary focus.
How much is Standard Bank vehicle finance focused on the private passenger vehicle consumer market as compared to the fleet management market and the agricultural sector?
Simphiwe: We have focused teams for passenger, commercial and agriculture and each market is important to the bank in relation to our customers. We offer a solution for all customer types and we target competitiveness in all segments.