Executive View: Can dealers cope with a flood of queries on historic car loans?

Steve Salvin, chief executive of Milton Keynes-based tech firm Aiimi, discusses how motor retail companies can ready their data for an influx of Data Subject Access Requests (DSAR) from consumers hoping for a payout from historic car loans.

Since the review of historic car finance loans kicked off in January, with the Financial Conduct Authority highlighting recent cases where lenders were deemed liable for commission that was undisclosed to car buyers, UK dealerships have been in overdrive.

And the probes they face - from regulators and customers eager to learn whether they are amongst the millions of people who are predicted to have been mis-sold unfair deals - will only increase between now and the review’s planned conclusion, on the 25th of September. 

Billions of pounds are at stake for car finance companies ordered to make payouts as a result of the review. But there’s no telling how much time all this will cost lenders.

Dealerships are already being ‘snowed’ under by requests for information, or Data Subject Access Requests (DSARs), from customers who are looking to understand their loan details ahead of claiming any compensation they might be entitled to. What is clear is that the stakes are high, and this is only just the beginning. 

To weather the DSAR storm which is rolling in, and be ready to deal with enquiries from regulators and customers alike - as well as any compensation this results in - dealerships will need to have all the relevant information to hand. In other words, dealers need to get their data in order now. 

Dealerships and DSARs

While this is a challenging time for lenders, car finance companies are not alone. Consumers are more aware of their digital footprints and data rights than ever. As a result, a rising number of DSARs are being submitted across the board.

Recent ICO figures also show a year-on-year increase in consumer complaints related to organisations handling DSARs.

Dealers must take note. Compliance with regulators and timely handling of DSARs - which come with strict deadlines - is key to avoid similar backlash and fines. And whilst managing DSARs can be time-consuming and costly in its own right, companies can handle requests swiftly, protect customer data, and avoid further penalties by establishing robust data strategies.

Clean up your data

When data is properly classified and stored, it is far easier to trace and retrieve the exact information required for DSARs. The problem is that, over the years, organisations accumulate vast amounts of data and store it across disparate systems.

These systems often don’t talk to each other and can quickly become outdated. At best, this can make for information which is hard to find, and inefficient ways of working. At worst, it can lead to lost data and compliance issues. 

The solution is to conduct a thorough data audit. Map out all systems used across the company, and label the various documents, video and image files stored within them. At the same time, safely dispose of any duplicate documents and outdated versions of files. 

This way, employees can know exactly what information the company holds and where to find it when customers and regulators come knocking - as well as when carrying out day-to-day tasks. Importantly, employees can also be sure that this information will be accurate. 

Check your data permissions

During the classification process, companies have an opportunity to review and adjust access permissions in line with the labels applied to data. 

For example, if sensitive documents containing the details of customers’ car finance loans are marked as such, they can be locked away from anyone that doesn’t need access - including the increasing numbers of hackers who are targeting the industry. This keeps customers’ personal information safe.

At the same time, users who will be dealing with any DSARs lodged by car finance customers can be given access to relevant documents following reliable identity verification, in order to deal with these requests efficiently.

Companies also have an opportunity here to ensure that they are complying with GDPR rules, safely destroying data after set retention periods, and collecting and sharing information only where they have permission to do so.

Customers are just one DSAR away from checking what information companies are holding about them and distributing to third parties. 

Automate with AI

Given the complexity and volume of data that dealers manage, AI tools can significantly aid companies in the process of discovering, classifying and securely storing information. 

For starters, automated data governance enables companies to get their information in order more quickly - ready to deal with the DSAR influx - and means that minimal lift is involved for individual employees who can continue with their skilled work.

Automating the process of establishing and maintaining well-governed data also enhances accuracy and security. For example, specialist AI tools can instantly filter out outdated files, make loan documents searchable, and allow or disallow users access to them, in line with individual permissions. 

There are significant challenges ahead for the automotive industry. But automated data governance can help companies not only ensure regulatory compliance, but enhance their customer services, and leverage AI to create new opportunities at the same time.

This is because well-governed data is needed to back up any safe and secure AI application.So dealers that use the technology to get their data in order now will be well placed to ride the wave of AI transformation and drive future innovation and solutions.

Author: Steve Salvin, chief executive, Aiimi