Background

Automotive Partners Funding works with car dealerships throughout Arizona to offer auto financing options for non-prime borrowers. They’ve built a successful business around managing all of their processes in-house from origination to recoveries.

Like many lenders, Automotive Partners Funding knew they had to adapt to overcome big challenges in the industry, including looming auto loan debt crisis, rising interest rates and declining originations. They understood they needed to improve their customer experience and that a new payments solution would be key to better servicing their existing customer base.

The Challenge: Making payments easier for every customer

• Poor customer payment experience: Borrowers had access to limited payment options and often required agent assistance to get information about their account that was not included in their monthly statement, such as the loan payoff amount. This led to more calls, a higher cost to accept payments and an increase in customer dissatisfaction.
• Serving cash preferred customers: Unbanked customers who rely on cash visited Automotive Partners Funding’s office to make their loan payment in person with some commuting for hours on a regular basis. 
• Increasing late payments and delinquencies: The company sent costly late notices through the mail to inform customers of their past due payments and attempt to curb delinquencies, adding days or weeks between sending the notice and the customer making the late payment. 

The Solution: A Flexible Payments Platform

Automotive Partners Funding partnered with PayNearMe to offer a wide range of payment options including debit card, ACH, cash at retail and alternative payment methods for their customers. 

PayNearMe’s cash at retail solution enabled Automotive Partners Funding to eliminate the need to handle cash on premise while allowing customers to continue to make their payments at nearby 7-Elevens, CVS, Walgreens and more.

Shortly after expanding their payment options, Automotive Partners Funding took advantage of PayNearMe’s flexible convenience fee structure and embedded fees for specific payment methods and channels to drive healthy payment behaviors. For example, customers who signed up for autopay or made payment with a guaranteed form of payment (such as cash) enjoyed discounted convenience fees, lowering the overall total payment amount for these customers. 

To further improve their customer experience, Automotive Partners Funding scheduled  automated SMS payment reminders powered by PayNearMe’s Engagement Engine. They managed to set up distinct messaging for customers at different points in the payment cycle, eliminating the need to send notices by mail and closing the gap between late notices and payments.

Additionally, PayNearMe’s single integration and contract for all payment methods means that Automotive Partners Funding now receives all of their charges in a single settlement and reconciliation report.

Results: Self-Service as a Driver for Success 

As a result of offering more ways to pay, Automotive Partners Funding managed to increase their self-service payments to 64% in less than a year with PayNearMe. In fact, Apple Pay made up 13% of their total payment volume, making it the third most popular payment method among their customers. This demonstrates that consumers appreciate the opportunity to make payments with the options that are most convenient to them. 

Their customers also responded positively to Engagement Engine’s payment reminders. Automotive Partners Funding saw the largest improvement with late payments, specifically for accounts that were past due by 1-10 days. By reducing their late payments by more than 50%, Automotive Partners Funding was able to realize huge operational and cost savings.

Text Engagements have not only helped us reduce our past due accounts, we’ve also been able to eliminate more than half of the late notices we send in the mail. This has created a huge savings on postage for us.

Bethany Berg
Vice President of Operations, Automotive Partners Funding

Customers weren’t the only ones who reaped the benefits of a new payments platform. Automotive Partners Funding staff were thrilled to save hours of manual payment posting and adopt a simplified reconciliation process with PayNearMe.

Switching to PayNearMe has significantly lightened my workload on a daily basis and made our month-end reporting a lot easier. We no longer need someone to batch post manually, the PayNearMe Platform does it for us.

Bethany Berg
Vice President of Operations, Automotive Partners Funding

At the same time, Automotive Partners Funding found great success with PayNearMe’s embedded chargeback management tools. This came as a huge surprise because their previous provider’s dispute process was so difficult to use that they would refrain from challenging claims to avoid the poor user experience all together.

PayNearMe’s dispute process is substantially easier, and has actually led to meaningful results for us. I was pleasantly surprised because we had never won a chargeback before with our previous system.

Bethany Berg
Vice President of Operations, Automotive Partners Funding

Needless to say, this change has allowed their loan servicing strategy to play a bigger role in the health of the business.