Advance Payment

In the automotive sector, following a positive credit decision for sales financing, trading partners require additional liquidity to order the vehicle or release it from existing wholesale or retail financing arrangements. In some cases, the trading partner would prefer to leave the vehicle in wholesale financing, but requires the registration certificate for preparing the sale of this vehicle. For financial services providers, this form of pre-financing also has a sales function alongside the direct business, because whoever provides for additional liquidity is generally also the preferred business partner in arranging wholesale financing.

The Advance Payment module group provides submitters (trading partners) with customised processes for the application, approval and settlement of advance payments for asset financing as soon as a positive credit decision for the retail financing of this asset is available. The scope of services ranges from the complete data transfer of the authorised retail financing request, the flexible selection of individually tailored repayment schedules, the recording of the required data content with appropriate validation checks, the automated search for information, the generation of automated or manual credit decisions with the help of workflow-aided credit processing and disbursement through to contract management and bookkeeping.

When establishing a master contract for advance payments, all settings such as the limits granted and their usage rate, base interest rates, ratings based on quantitative and qualitative criteria and many more, can be carried out.

Features Advance Payment

  • Request for the advance payment by transferring the asset data and other master data from the approved wholesale financing application and selecting the financial product
  • Automatic check of the application within seconds incl. determination of the credit limit available, determination of the prepayment, taking into account any discount factors
  • Automatic and if necessary manual decision, taking into account customer-specific stop and knock-out criteria with exact logging of the decision history
  • Workflow-based credit processing with defined validation steps up to contract activation incl. designation and information transfer to the underlying retail financing operation
  • Disbursement of funds to the account of the submitter or the borrower and processing repayments according to the repayment plan with monthly interest calculation
  • Balance of the advance payment upon activation of retail financing, taking into account higher or lower amounts.
  • Acquisition of partners, granting the credit limit and individual terms depending on rating, maintenance of transaction accounts and payment, etc.
  • Support of customisable repayment plans with determination of interval and timing of repayments, amount of the repayments as percentage or value, nature and amount of the interest premium, as well as the interest bearer, discount factors for type and age of asset etc.
  • Creation of individual repayment schedules specifying frequency or specific redemption dates, the volume of repayments as a percentage or amount, determination of liability for interest payment as well as type and amount of interest rate mark-up, discount factors for type and age of asset, etc.

Advantages at a glance

  • End-to-end system: the entire life cycle of Advance Payments – from the proposal to termination of contract – is designed as a fully integrated, web-based system.
  • Free choice of sales channels: financial services providers are present in all desired B2B and B2C sales channels on all terminals.
  • Settlement of payment transactions: automatic settlement of payment transactions (netting) between wholesale and retail financing is possible in connection with retail finance. High degree of automation: with afb-CMS, our customers operate their business at the highest level of automation. It is designed for high-volume, standardised processes, quick decisions and automated handling of contract management.
  • High level of automation: the solution is designed for large volumes, standardised processes, fast decisions and automated contract management.

 

  • Flexible financial products: submitters (trading partners) can be offered flexible financial products.
  • For different asset groups: financing transactions can be offered for all standard asset groups (e.g. motor vehicles, equipment).
  • Individual risk strategy: credit decisions are exclusively based on the criteria and rules defined by the financial services provider. This ensures compliance with standardised and centralised financing policies and regulatory requirements.
  • Interaction with collateral management: when activating the contract, and during its term, afb-CMS checks whether all the collateral required under the established rules, such as registration documents, mortgages and mortgage entries, cessions of life insurance policies etc., has been provided and is linked to the master and asset contracts.

 

For more information, please contact us

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