{"id":2338,"date":"2019-02-15T10:56:15","date_gmt":"2019-02-14T23:56:15","guid":{"rendered":"https:\/\/basiq.io\/?p=2338"},"modified":"2023-11-29T02:28:22","modified_gmt":"2023-11-29T02:28:22","slug":"banking-royal-commission-auto-finance","status":"publish","type":"post","link":"https:\/\/basiqio.wtdevsite.com\/blog\/banking-royal-commission-auto-finance\/","title":{"rendered":"How the banking royal commission will affect the auto-financing industry"},"content":{"rendered":"\n

The recent release of the banking royal commission\u2019s interim report has highlighted that responsible lending practices need to be extended to the auto-finance industry.<\/p>\n\n\n\n

The implications of this for entities making car loans is significant as KPMG estimates 93% of all car sales are currently arranged through finance<\/strong>, many of which have fallen short of responsible lending provisions.<\/p>\n\n\n\n

<\/div>\n\n\n\n

According to the report it is not enough to use ‘likelihood of default’ as a measure of loan suitability.<\/strong><\/h2>\n\n\n\n

Prior to making an assessment on whether a loan is suitable, the licensee must now take a number of steps to ensure responsible lending provisions are met.<\/p>\n\n\n\n

These necessary steps include:<\/p>\n\n\n\n

\n

“making reasonable inquiries about the consumer\u2019s requirements and objectives in relation to the credit contract;<\/em> making reasonable inquiries about the consumer\u2019s financial situation; and<\/em> taking reasonable steps to verify the consumer\u2019s financial situation.”<\/em><\/p>\n<\/blockquote>\n\n\n\n

The third step is particularly important as customers can easily make false or misleading statements about their financial position.<\/p>\n\n\n\n

Whilst lenders in the auto-finance industry have taken some steps in verifying an applicant\u2019s income the same has not been done for their expenditure.<\/p>\n\n\n\n

Instead they have relied on the Household Expenditure Measure (HEM) despite the fact that the commission found \u201cthree out of four households spend more on discretionary basics than is allowed in HEM<\/strong>.\u201d<\/p>\n\n\n\n

The commission has suggested that an applicant\u2019s bank accounts and actual transaction data offer a source of income and expense verification far superior to HEM<\/strong> and other estimates.<\/p>\n\n\n\n

<\/div>\n\n\n\n

So how can lenders acquire and use this data to verify an applicant\u2019s financial situation?<\/h2>\n\n\n\n

With the open banking regime set to be phased in from July, customers will be able to make their banking data available to service providers of their choice. This offers a significant opportunity in helping to solve the issue of responsible lending as it provides access to real time and historical data.<\/p>\n\n\n\n

Basiq is an open banking platform that ensures more efficient and responsible lending based on an applicant’s actual bank transaction data.<\/strong><\/p>\n\n\n\n

This can be done via Basiq’s Affordability report which provides a full view of a customer’s financial position by combing and categorising their expenses, income, assets and liabilities across financial institutions into one single view.<\/p>\n\n\n\n

This offers a more accurate, time and cost effective alternative to manual credit decisioning<\/strong> whilst ensuring that the commission recommended steps for responsible lending are being met.<\/p>\n\n\n\n

<\/div>\n\n\n\n

For more on how Basiq’s Affordability can help with better credit decisioning get in touch<\/a> with the team today.<\/strong><\/p>\n\n\n\r\n

\r\n\t
\r\n\t\t
\r\n\t\t\t
\r\n\t\t\t\tArticle Sources\t\t\t<\/h5>\r\n\t\t<\/div>\r\n\r\n\t\t
\r\n\t\t\t\r\n\t\t\t\t\r\n\t\t\t\t\tArticle Sources\t\t\t\t<\/strong>\r\n\r\n\t\t\t\t\r\n\t\t\t\t\t\r\n\t\t\t\t\t\tRead more\t\t\t\t\t<\/span>\r\n\r\n\t\t\t\t\t\r\n\t\t\t\t\t\tRead less\t\t\t\t\t<\/span>\r\n\t\t\t\t<\/strong>\r\n\t\t\t<\/button>\r\n\t\t<\/div>\r\n\r\n\t\t\r\n\t\t\t

The recent release of the banking royal commission\u2019s interim report has highlighted that responsible lending practices need to be extended to the auto-finance industry. Open banking provides a potential avenue to help solve for this.<\/p>\n","protected":false},"author":27,"featured_media":13718,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[],"acf":[],"yoast_head":"\nHow the banking royal commission will affect the auto-financing industry | Open Banking API Platform - Basiq<\/title>\n<meta name=\"robots\" content=\"noindex, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"How the banking royal commission will affect the auto-financing industry | Open Banking API Platform - Basiq\" \/>\n<meta property=\"og:description\" content=\"The recent release of the banking royal commission\u2019s interim report has highlighted that responsible lending practices need to be extended to the auto-finance industry. Open banking provides a potential avenue to help solve for this.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/basiqio.wtdevsite.com\/blog\/banking-royal-commission-auto-finance\/\" \/>\n<meta property=\"og:site_name\" content=\"Open Banking API Platform - Basiq\" \/>\n<meta property=\"article:published_time\" content=\"2019-02-14T23:56:15+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2023-11-29T02:28:22+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/basiqio.wtdevsite.com\/blog\/wp-content\/uploads\/2019\/02\/2338_bankingroyalcommission_1280x720_v4.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1280\" \/>\n\t<meta property=\"og:image:height\" content=\"720\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Damir \u0106u\u0107a\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Damir \u0106u\u0107a\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/basiqio.wtdevsite.com\/blog\/banking-royal-commission-auto-finance\/\",\"url\":\"https:\/\/basiqio.wtdevsite.com\/blog\/banking-royal-commission-auto-finance\/\",\"name\":\"How the banking royal commission will affect the auto-financing industry | Open Banking API Platform - Basiq\",\"isPartOf\":{\"@id\":\"https:\/\/basiqio.wtdevsite.com\/blog\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/basiqio.wtdevsite.com\/blog\/banking-royal-commission-auto-finance\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/basiqio.wtdevsite.com\/blog\/banking-royal-commission-auto-finance\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/basiqio.wtdevsite.com\/blog\/wp-content\/uploads\/2019\/02\/2338_bankingroyalcommission_1280x720_v4.jpg\",\"datePublished\":\"2019-02-14T23:56:15+00:00\",\"dateModified\":\"2023-11-29T02:28:22+00:00\",\"author\":{\"@id\":\"https:\/\/basiqio.wtdevsite.com\/blog\/#\/schema\/person\/28d90e81b18e522af8c2b7820dbf581b\"},\"breadcrumb\":{\"@id\":\"https:\/\/basiqio.wtdevsite.com\/blog\/banking-royal-commission-auto-finance\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/basiqio.wtdevsite.com\/blog\/banking-royal-commission-auto-finance\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/basiqio.wtdevsite.com\/blog\/banking-royal-commission-auto-finance\/#primaryimage\",\"url\":\"https:\/\/basiqio.wtdevsite.com\/blog\/wp-content\/uploads\/2019\/02\/2338_bankingroyalcommission_1280x720_v4.jpg\",\"contentUrl\":\"https:\/\/basiqio.wtdevsite.com\/blog\/wp-content\/uploads\/2019\/02\/2338_bankingroyalcommission_1280x720_v4.jpg\",\"width\":1280,\"height\":720},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/basiqio.wtdevsite.com\/blog\/banking-royal-commission-auto-finance\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/basiqio.wtdevsite.com\/blog\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"How the banking royal commission will affect the auto-financing industry\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/basiqio.wtdevsite.com\/blog\/#website\",\"url\":\"https:\/\/basiqio.wtdevsite.com\/blog\/\",\"name\":\"Open Banking API Platform - Basiq\",\"description\":\"Basiq is the leading open banking api platform enabling developers to build innovative financial solutions. We provide secure access to customer-consented financial data and powerful APIs that uncover valuable insights.\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/basiqio.wtdevsite.com\/blog\/?s={search_term_string}\"},\"query-input\":\"required name=search_term_string\"}],\"inLanguage\":\"en-US\"},{\"@type\":\"Person\",\"@id\":\"https:\/\/basiqio.wtdevsite.com\/blog\/#\/schema\/person\/28d90e81b18e522af8c2b7820dbf581b\",\"name\":\"Damir \u0106u\u0107a\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/basiqio.wtdevsite.com\/blog\/#\/schema\/person\/image\/\",\"url\":\"https:\/\/secure.gravatar.com\/avatar\/85b7121af947bd1e6098dbed90f68c09?s=96&d=blank&r=g\",\"contentUrl\":\"https:\/\/secure.gravatar.com\/avatar\/85b7121af947bd1e6098dbed90f68c09?s=96&d=blank&r=g\",\"caption\":\"Damir \u0106u\u0107a\"},\"description\":\"Damir \u0106u\u0107a is the founder and CEO of Basiq. He has extensive experience in software development & financial technology including expertise in CDR, Open Banking & API\u2019s, often advising government departments on the progress of CDR. Damir is passionate about his Serbian roots, 90s hip hop and martial arts.\",\"url\":\"https:\/\/basiqio.wtdevsite.com\/blog\/author\/damir-cuca\/\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"How the banking royal commission will affect the auto-financing industry | Open Banking API Platform - Basiq","robots":{"index":"noindex","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"og_locale":"en_US","og_type":"article","og_title":"How the banking royal commission will affect the auto-financing industry | Open Banking API Platform - Basiq","og_description":"The recent release of the banking royal commission\u2019s interim report has highlighted that responsible lending practices need to be extended to the auto-finance industry. Open banking provides a potential avenue to help solve for this.","og_url":"https:\/\/basiqio.wtdevsite.com\/blog\/banking-royal-commission-auto-finance\/","og_site_name":"Open Banking API Platform - Basiq","article_published_time":"2019-02-14T23:56:15+00:00","article_modified_time":"2023-11-29T02:28:22+00:00","og_image":[{"width":1280,"height":720,"url":"https:\/\/basiqio.wtdevsite.com\/blog\/wp-content\/uploads\/2019\/02\/2338_bankingroyalcommission_1280x720_v4.jpg","type":"image\/jpeg"}],"author":"Damir \u0106u\u0107a","twitter_card":"summary_large_image","twitter_misc":{"Written by":"Damir \u0106u\u0107a","Est. reading time":"2 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/basiqio.wtdevsite.com\/blog\/banking-royal-commission-auto-finance\/","url":"https:\/\/basiqio.wtdevsite.com\/blog\/banking-royal-commission-auto-finance\/","name":"How the banking royal commission will affect the auto-financing industry | Open Banking API Platform - Basiq","isPartOf":{"@id":"https:\/\/basiqio.wtdevsite.com\/blog\/#website"},"primaryImageOfPage":{"@id":"https:\/\/basiqio.wtdevsite.com\/blog\/banking-royal-commission-auto-finance\/#primaryimage"},"image":{"@id":"https:\/\/basiqio.wtdevsite.com\/blog\/banking-royal-commission-auto-finance\/#primaryimage"},"thumbnailUrl":"https:\/\/basiqio.wtdevsite.com\/blog\/wp-content\/uploads\/2019\/02\/2338_bankingroyalcommission_1280x720_v4.jpg","datePublished":"2019-02-14T23:56:15+00:00","dateModified":"2023-11-29T02:28:22+00:00","author":{"@id":"https:\/\/basiqio.wtdevsite.com\/blog\/#\/schema\/person\/28d90e81b18e522af8c2b7820dbf581b"},"breadcrumb":{"@id":"https:\/\/basiqio.wtdevsite.com\/blog\/banking-royal-commission-auto-finance\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/basiqio.wtdevsite.com\/blog\/banking-royal-commission-auto-finance\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/basiqio.wtdevsite.com\/blog\/banking-royal-commission-auto-finance\/#primaryimage","url":"https:\/\/basiqio.wtdevsite.com\/blog\/wp-content\/uploads\/2019\/02\/2338_bankingroyalcommission_1280x720_v4.jpg","contentUrl":"https:\/\/basiqio.wtdevsite.com\/blog\/wp-content\/uploads\/2019\/02\/2338_bankingroyalcommission_1280x720_v4.jpg","width":1280,"height":720},{"@type":"BreadcrumbList","@id":"https:\/\/basiqio.wtdevsite.com\/blog\/banking-royal-commission-auto-finance\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/basiqio.wtdevsite.com\/blog\/"},{"@type":"ListItem","position":2,"name":"How the banking royal commission will affect the auto-financing industry"}]},{"@type":"WebSite","@id":"https:\/\/basiqio.wtdevsite.com\/blog\/#website","url":"https:\/\/basiqio.wtdevsite.com\/blog\/","name":"Open Banking API Platform - Basiq","description":"Basiq is the leading open banking api platform enabling developers to build innovative financial solutions. We provide secure access to customer-consented financial data and powerful APIs that uncover valuable insights.","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/basiqio.wtdevsite.com\/blog\/?s={search_term_string}"},"query-input":"required name=search_term_string"}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/basiqio.wtdevsite.com\/blog\/#\/schema\/person\/28d90e81b18e522af8c2b7820dbf581b","name":"Damir \u0106u\u0107a","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/basiqio.wtdevsite.com\/blog\/#\/schema\/person\/image\/","url":"https:\/\/secure.gravatar.com\/avatar\/85b7121af947bd1e6098dbed90f68c09?s=96&d=blank&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/85b7121af947bd1e6098dbed90f68c09?s=96&d=blank&r=g","caption":"Damir \u0106u\u0107a"},"description":"Damir \u0106u\u0107a is the founder and CEO of Basiq. He has extensive experience in software development & financial technology including expertise in CDR, Open Banking & API\u2019s, often advising government departments on the progress of CDR. Damir is passionate about his Serbian roots, 90s hip hop and martial arts.","url":"https:\/\/basiqio.wtdevsite.com\/blog\/author\/damir-cuca\/"}]}},"author_data":{"name":"Damir \u0106u\u0107a","url":"https:\/\/basiqio.wtdevsite.com\/blog\/author\/damir-cuca\/"},"categories_data":[{"name":"Basiq Insights","url":"https:\/\/basiqio.wtdevsite.com\/blog\/category\/basiq-insights\/"}],"reading_time":"4 minute read","images":{"featured":"https:\/\/basiqio.wtdevsite.com\/blog\/wp-content\/uploads\/2019\/02\/2338_bankingroyalcommission_1280x720_v4.jpg","hero_img":"https:\/\/basiqio.wtdevsite.com\/blog\/wp-content\/uploads\/2023\/10\/2338_bankingroyalcommission_1440x375_v4.jpg"},"_links":{"self":[{"href":"https:\/\/basiqio.wtdevsite.com\/blog\/wp-json\/wp\/v2\/posts\/2338"}],"collection":[{"href":"https:\/\/basiqio.wtdevsite.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/basiqio.wtdevsite.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/basiqio.wtdevsite.com\/blog\/wp-json\/wp\/v2\/users\/27"}],"replies":[{"embeddable":true,"href":"https:\/\/basiqio.wtdevsite.com\/blog\/wp-json\/wp\/v2\/comments?post=2338"}],"version-history":[{"count":5,"href":"https:\/\/basiqio.wtdevsite.com\/blog\/wp-json\/wp\/v2\/posts\/2338\/revisions"}],"predecessor-version":[{"id":16149,"href":"https:\/\/basiqio.wtdevsite.com\/blog\/wp-json\/wp\/v2\/posts\/2338\/revisions\/16149"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/basiqio.wtdevsite.com\/blog\/wp-json\/wp\/v2\/media\/13718"}],"wp:attachment":[{"href":"https:\/\/basiqio.wtdevsite.com\/blog\/wp-json\/wp\/v2\/media?parent=2338"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/basiqio.wtdevsite.com\/blog\/wp-json\/wp\/v2\/categories?post=2338"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/basiqio.wtdevsite.com\/blog\/wp-json\/wp\/v2\/tags?post=2338"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}

Basiq mandates its writers to leverage primary sources such as internal data, industry research, white papers, and government data for their content. They also consult with industry professionals for added insights. Rigorous research, review, and fact-checking processes are employed to uphold accuracy and ethical standards, while valuing reader engagement and adopting inclusive language. Continuous updates are made to reflect current financial technology trends. You can delve into the principles we adhere to for ensuring reliable, actionable content in our editorial policy<\/a>.<\/p>\n\t\t<\/div>\r\n\t<\/div>\r\n<\/div>\r\n","protected":false},"excerpt":{"rendered":"