Throughout the pandemic, the RV industry made incredible innovations and investments to improve the end-customer-facing commercial transaction process and technology workflows. The result has been an exceptional acceleration in digitizing transactions—or at least digitizing customer-facing touchpoints.
Although the ecosystem focused on technology-driven innovation to fuel an improved customer experience, the process still remains largely paper-based, insecure and inefficient or clunky. These processes and components include transactions between RV dealers, financing partners and consumers.
Even systems using a more digitized process are often fragmented. Using disparate technologies and platforms severely hampers all parties’ broader experience.
As the next digital transformation happens, parties will realize more improvement is needed throughout the transaction, particularly around the use of paper. In today’s world, RV transaction paper use is inefficient, creating risk and liability.
RV dealers are willing to update processes to meet customer expectations, which we have seen throughout the pandemic and in the years since. The resulting economic changes meant RV dealers and their valued consumers needed more business agility and flexibility incorporated into the transaction. Digital processes help in this regard.
RV Dealers Must Leave the Paper World
Paper use is not only inefficient but also carries significant compliance risk. The RV industry still has a very paper-driven culture, wrought with risk and liability for everyone involved. To solve transactional risk and liability, we need to shift focus to digitization and away from paper use and original document management. We need to find end-to-end solutions to eliminate paper’s need.
Digitization of the entire process will solve several industry key pain points.
First and foremost, digitization will significantly reduce the risk and liability that exposed personally identifiable information (PII) causes in a paper-based environment. Managing paper has major inefficiencies and added costs to keep up with revisions and more. A paper-based environment often results in using outdated contracts, which usually leads to lender rejections. Paper is then returned to the customer, which further increases PII exposure risk.
As we have seen with the emergence of e-contracting solutions, RV dealers and lenders are evolving to abandon paper. Using e-contracting, dealers and lessors have seen significant enhancements, including faster processing, streamlined workflows and a more reliable, trusted document-handling system.
Additional solutions include digital signatures deposited into digital vaults to protect access to documentation, digital transfer between the lender and consumer when funding a deal, and the ability to create documents electronically so dealers and lenders can digitalize and securitize assets. A digital transaction ecosystem provides a secure, documented audit trail.
The next digital transformation phase will leverage words such as e-contracting, multichannel origination, digital certainty, auditing, document governance, security, post-transaction asset management and analysis tasks across a document’s entire journey. Although not as flashy as the consumer experience change over the past several years, the back-end transformation is critical for the industry to evolve to the next digitalization chapter.
Digital Ecosystems’ Need
To overcome challenges, RV dealers are beginning to leverage digital ecosystems built to handle the industry’s origination channel diversity. Digital ecosystems eliminate the complexities around managing various multichannel assets post-execution and drastically reduce operational and time costs.
The process provides improved asset visibility, quick investor and lender pool expansion, agility and the ability to scale quickly and dynamically.
Digital ecosystems also provide legal and regulatory compliance assurance. The certainty enables financiers and lessors to securely manage digital assets throughout their entire post-execution life cycle using an electronic collateral control agreement (ECCA).
This advanced process will offer centralized data management across an entire portfolio, enabling RV dealers to view metadata across various origination channels.
Additionally, the process will control and track access, manage status changes and transfer digital-document control by using sophisticated, granular controls and permissions. Document control will enable departmental separation and visibility to improve speed and process efficiency. For lenders, particularly, the process will free up capital through syndication, sale or securitization.
With these enhancements, the industry can boast about its front-end digital transformation for consumers and its back-office transformation between RV dealers and their financing operations.
Tim Yalich is Head of Motor Vehicle Strategy for Wolters Kluwer, a global provider of professional information, software solutions and services for the motor vehicle finance industries.
