The refinancing industry at large has always been dependent on consumer awareness. Yes, almost everyone who is buying a home or car (or paying for a college education) knows they’ll need a loan. How many of those people, however, are aware they can refinance their loan?
Beyond being cognizant of refinancing options, there are other barriers in place. A considerable amount of consumers are unaware of how much they can actually save, or simply don’t want to deal with the hassle and paperwork. It’s why 78% of American homeowners opted not to refinance their mortgages in 2021, despite lower interest rates driven by the pandemic.
When it comes to auto loans, over 50% of consumers aren’t even aware they can refinance. That represents a fairly large chunk of the market that is not being properly addressed. And while the pandemic led to greater consumer awareness ― Google searches for auto refinancing increased by 40% from 2019 to 2020 ― refinancing still only makes up roughly 5% of auto loan originations.
Even before the pandemic, the digital acceleration of financial services resulted in more people buying and financing vehicles online. When lockdowns went into effect, along with the subsequent surge in car sales brought on by reduced rates and stimulus spending, it became more clear that refinancing lenders were going to have better access to consumers.
And while the improved interest rate environment did represent a prime buying opportunity, it was inevitable that those same consumers would be in the market once again, only this time for refinancing. According to a survey, 26 of 73 million consumers would be highly motivated to refinance their loan. From a marketing perspective, most are looking for “payment-based savings” (i.e., lowering their monthly payment) rather than simply reducing their APR.
For lenders and marketers, the advantages of auto loan refinancing go beyond the obvious consumer need. It also represents an attractive opportunity to build better, more cost-efficient customer relationships. For example, since most delinquencies occur within the first few months a car is purchased, auto loan refinancing typically has a better risk profile and performance than auto purchase loans.
Similarly, direct-to-consumer (i.e., lender-generated) auto loans generally perform better than dealer-originated loans, which usually have higher markups. When you consider that nearly 80% of consumers finance their cars with dealers, the opportunity for auto loan refinancing becomes even bigger.
Auto loan refinancing is also easier to market than auto purchase loans, since lenders, brokers, and lead generators are able to eliminate the challenges of identifying or predicting which consumers are in the market for an auto loan. They can also target which consumers are less likely to default based on previous track records of loan payment.
While it’s clear there is a big market for auto loan refinancing, coupled with the benefits for lenders and third parties, the art of effectively engaging consumers remains elusive. Historically, banks and credit unions have been slow to explore and grow the necessary channels. Since auto loans are smaller than mortgages for example, the transaction costs for originators are relatively higher.
On top of that, the cumbersome nature of refinancing a vehicle can also be difficult to market, especially with younger demographics that are mostly concerned with convenience. For Gen Z specifically, they are going to seek out refinancing options that are as frictionless as possible and available in the palm of their hand.
That’s where technology comes in. The rise of fintech and AI have not only made it easier for lenders to target the right consumers, but for those same consumers to find the best refinancing offers for their needs in the most hassle-free way possible.
As opposed to traditional credit models, AI incorporates greater data and algorithms to optimize the experience for every consumer, finding them the best rates possible based on their risk profile. In addition, AI underwriting also automates the loan originating process, resulting in more instant credit decisions and less paperwork for lenders.
Through open banking technology, consumers also have less paperwork on their end thanks to pre-populated application fields. These barriers may seem minor (e.g., populating a consumer’s VIN or license plate number), but add up in the grand scheme of streamlining the process. AI models also help in presenting instant soft credit decisions, like pre-approval, which provide consumers better assurance they will get the product they are looking for.
Ultimately, AI and automation reduce the overhead that has burdened brick & mortar financial services for decades. With a market that still has exponential room for growth, it’s important for lenders and third-party brokers to not only highlight the benefits of auto loan refinancing to consumers, but also the technological advancements that have made finding and applying for the right product easier than ever.
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MoneyLion’s consumer and enterprise businesses were recognized as winners of Benzinga’s 2022 Global Fintech Awards at this year’s Fintech Deal Day
New York, December 14, 2022-- MoneyLion Inc. (“MoneyLion”) (NYSE: ML), the go-to destination for personalized financial content, products and advice, is proud to announce that it has been named “Best Financial Literacy Tool” at Benzinga’s 2022 Global Fintech Awards. MoneyLion’s enterprise business, Even Financial, was also named as the winner for “Best API.”
MoneyLion and Even Financial were honored alongside other top Fintechs, banks, research companies and more. MoneyLion’s consumer business continues to push financial literacy through innovative and personalized content. With the MoneyLion app, users can view personalized financial content in short-form video format and receive personalized financial product recommendations such as loans, insurance and investing. As MoneyLion’s enterprise offering, Even Financial digitally connects and matches consumers with real-time personalized product recommendations from banks, insurance carriers, and Fintech companies on mobile apps, websites and other digital touchpoints through its financial product search engine and Embedded Finance Marketplace technology. This technology powers both the MoneyLion Marketplace, in the MoneyLion app, as well as more than 1,000 enterprise partners.
“We’re thrilled MoneyLion’s consumer and enterprise businesses were recognized by Benzinga,” said Dee Choubey, Co-Founder and CEO of MoneyLion. “Both awards showcase MoneyLion’s every time you money approach to helping our customers. The financial literacy gap is a huge problem for millions of Americans and we remain committed to reducing its effects through engaging, informative content and key partnerships designed to bring an elevated educational experience to all.”
These awards follow the October announcement of MoneyLion University, where MoneyLion launched its latest initiative aimed at closing the gap in money and financial education across the United States.
“We could not be more pleased with Benzinga’s recognition of our company’s API technology,” stated Phill Rosen, CEO and Founder of Even Financial. “Our technology natively integrates real-time credit decisions and product recommendations from the industry’s largest network of connected financial services providers, offering access and choice to consumers searching for financial products. Our elegant Embedded Finance Marketplace, API and search engine enable any company to add trusted, personalized financial products and services to their business, reaching people when and where they need it.”
Even Financial has been named a listmaker for the Benzinga Global Fintech Awards for the last two years and was a previous award winner. In 2021, Even was selected as a listmaker for Best API and, in 2020, selected as a listmaker for both Best API and Best API Platform. In 2019, Even was awarded the Benzinga Rocky Award.
The annual Benzinga Global Fintech Awards take pride in recognizing and honoring the companies and individuals who are propelling the Fintech and financial services industry forward with the most impressive technology advancements and innovations. A panel of industry experts from a wide range of companies reviewed and judged the nominations. Winners were announced at Benzinga’s Fintech Deal Day on December 8, 2022, where MoneyLion’s Chief Customer Officer Cynthia Kleinbaum spoke on the panel, Expert Growth Hacks For Reaching Underserved Markets.
About MoneyLion MoneyLion is the go-to destination for personalized financial content, products and advice. MoneyLion’s mission is to rewire the financial system to positively change the path of every hard-working American. MoneyLion uses its proprietary data advantage and technology to empower its customers. MoneyLion engages and educates its customers with daily, hyper-personalized money-related and money-adjacent content that is delivered through each customer’s own content feed. MoneyLion provides its customers a full suite of financial and non-financial solutions, bundling its proprietary, low-cost financial products with products that are offered through its marketplace technology and network affiliate partners. MoneyLion also leverages its distinct data, technology, and network advantages to deliver leading embedded finance and marketplace solutions for enterprise customers. Since its founding in 2013, MoneyLion has empowered millions of Americans to take control of their finances and live their best financial life, every day.
For more information about the company, visit https://www.moneylion.com/ and https://www.evenfinancial.com. For investor information and updates, visit investors.moneylion.com and follow @MoneyLionIR on Twitter.
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Even Financial [email protected]
New York, Jan. 11, 2023 -- Even Financial ("Even"), an independent subsidiary of MoneyLion Inc. (NYSE: ML), and a leading embedded finance marketplace platform, is proud to announce that it was honored in Built In’s “2023 Best Places To Work” Awards. Specifically, Even earned a place on the Hybrid Best Places to Work in New York.
The Best Places to Work Awards, now in its fifth year, honors companies across numerous categories, sizes, remote-first employers as well as in person and hybrid working companies across the U.S.
Built In determines the winners of Best Places to Work based on an algorithm, using company data about compensation and benefits, and also weighs criteria like remote and flexible work opportunities, as well as other people-first cultural offerings.
This announcement follows Even’s recent win at the Benzinga Global Fintech Awards for “Best API.”
About Even Financial
Even is the industry-leading embedded financial marketplace and independent subsidiary of MoneyLion Inc. (“MoneyLion”) (NYSE: ML). MoneyLion is a leading digital financial services and lifestyle content platform serving both consumer and enterprise customers. As part of MoneyLion’s enterprise offering, Even digitally connects and matches consumers with real-time, personalized financial product recommendations from banks, insurance carriers, and fintech companies on mobile apps, websites, and other digital touchpoints through its marketplace technology. Even's infrastructure leverages machine learning and advanced data science to solve a significant pain point in financial services customer acquisition, seamlessly bridging financial services providers (such as SoFi) and channel partners (such as TransUnion) via its industry-leading API and embedded finance marketplaces. Even enables any company to add financial products to its business, with full compliance and security at scale. Even was named one of "America's Best Startup Employers'' by Forbes for 2022 and was named to the 2021 Deloitte Technology Fast 500, which recognizes the fastest growing tech companies in the world. Learn more at www.evenfinancial.com and investors.moneylion.com.