Streamlining automotive lending on a global scale with defi SOLUTIONS

Consider this scenario: a couple walks into an automobile dealership and finds the car of their dreams. After some discussion with a salesperson, they finally sit with the financing department to fill out a loan application. At the moment when they submit that application, their personal, confidential information is sent to potentially dozens of lenders who will compete for that couple’s business. 

Vehicle lending is an incredibly large and complex industry with an estimated value of approximately $220 billion as of 2019. Part of what automotive lenders do to stay competitive is to provide fast and comprehensive decisions to borrowers who want to purchase a vehicle so that they will be more likely to buy at that moment. If they have to wait, the dealership may lose a customer.

defi SOLUTIONS supports that kind of work by providing critical support for lenders in areas like automotive, sports vehicle, marine vehicle, and light truck purchases, as well as loan account management, who want a product that can help them manage loan applications effectively, approve loans quickly and efficiently, and maintain key compliance standards across multiple countries.

As the demands of this industry continue to grow, and the needs of clients evolve, defi SOLUTIONS decided to migrate existing platforms, spanning four lines of business, to the cloud. Its focus on security, speed, and cost led the company to adopt Microsoft Azure.

Building solutions for the ’speed business‘ of automotive financing

The defi suite of solutions serves an important purpose in the automotive industry: it supports lending for financial institutions and car companies so that they can quickly lease or finance vehicle purchases for consumers in North America. This purpose touches on lenders, automotive companies, and consumers by providing fast and accurate results during the loan origination process, and then later during the account management lifecycle.

“The origination business is a speed business,” said Shaimaa Elk, Executive VP of Operations and Chief Information Officer at defi SOLUTIONS. “When a consumer credit application to lease or purchase a vehicle is submitted, the results are expected to be highly accurate and in near real time. If a lender origination system cannot deliver that, the lender loses the business.”

Unsurprisingly, managing lending, consumer verification, security, and compliance across different companies is a challenging task. With these kinds of speed requirements, that challenge is only amplified. That’s why automotive lenders look to defi technology to support time-sensitive and critical financial transactions.

“In the auto finance world, defi is a very unique company,” said Elk, “because we offer an end-to-end solution for auto finance from originations to servicing, special solutions for pricing management, consumer and dealer communication portals, and BPO functionality. In a way, we are the most comprehensive when it comes to market share and breadth of offerings in the market.”

This breadth of functionality helps lenders streamline auto purchases and account management while still giving the consumer a delightful experience. However, defi’s solutions had previously been hosted on-premises, which made meeting the needs of an increasingly complex industry slower and more expensive. In this business, it doesn’t matter how good you are if you aren’t faster than the competition.

With clients like Bank of America, U.S. Bank, and Ally Financial demanding the highest standards for financial transactions and OEMs like Toyota, Porsche, and Volkswagen operating in multiple countries—each with multiple layers of regulations—it became more important for defi to respond to and adopt measures for security and compliance so that it could meet these clients' needs more quickly.

That’s when defi decided to move to a native cloud solution with Microsoft Azure.

Cutting costs and time to market with Azure

The complete transformation from on-premises to fully cloud-enabled solutions took about a year. Within the first quarter after migration, the company was able to shift multiple lines of business into the cloud and immediately begin serving its clients with cloud services. This means faster time-to-market solutions and drastically reduced costs.

“Being in the cloud, we can cut time to market by up to 80 percent,” said Elk. This kind of responsiveness is crucial since defi deploys new solutions and features in response to market needs. For example, defi deployed a new intelligent document ingestion solution taking advantage of Microsoft Forms and AI in three months. Additionally, new standards in information security out of Germany—the Trusted Information Security Assessment Exchange (TISAX) standard—shape how lenders and car companies in Germany transmit and share consumer financial information. Since Azure already has TISAX compliance built into the platform, defi could immediately offer datacenter TISAX compliance for its clients in the United States and Europe.

Likewise, staying on-premises would incur serious costs when adapting to these security requirements. Kevin Ayers, Head of Enterprise Architecture at defi SOLUTIONS mentions a client who wanted to manage security certificates using an on-premises HSM system that would cost $750,000. In the cloud, it costs around a dollar.

The shift to the cloud allows defi to empower both consumers and dealers with a focus on smooth buyer journeys. The company’s goal is to develop platforms that can support online purchasing for its clients, consolidating shopping, credit checks, and approval in a single “buy from the couch” approach, and Azure provides the tools and ecosystem to do it.

Building solutions now, and for the future

In an increasingly complex industry, defi has managed to streamline creating solutions within a span of months, rather than years, to the benefit of its clients and consumers. Aligning with its core beliefs of thinking like customers, creating excellent experiences, and building for tomorrow, defi SOLUTIONS uses Azure to create end-to-end solutions and envision new possibilities for advanced software using analytics, machine learning, and AI to shape the future of automotive lending.