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Lending and Leasing companies are ready to compete in the “new normal” environment

Linedata (NYSE Euronext: LIN), the global solution provider dedicated to the investment management and credit industries, today announced the results of its third annual survey on the priorities and challenges facing the global lending and leasing community.

Back to growth, but in a new environment

Economic figures and analyst surveys indicate that growth is back for the lending and leasing industry. While growth is back, it is not the same environment as it was before 2008. Regulation pressures, client behavior and bank governance have all changed. The survey that Linedata recently deployed resonates with those trends and highlights the challenges and opportunities for lending and leasing professionals in this “new normal” market.

Future challenges: less focused on regulation, more on client relationship management and new offerings

Although regulation remains the top challenge for 2014, the second and third biggest concerns demonstrate that the market has reached an important milestone. In 2013, financial companies were extending risk management capabilities and cutting costs; during 2014, they are focusing on increasing attention to client relationship management and developing new offerings and services. The IT priorities also address the need to be more focused on business development, while streamlining processes and mastering risk. Business intelligence tools, origination and front-office platforms, and portfolio and risk management systems will be the focus for major investments.

SaaS and mobility adoption: depending on the business

Hosting of business solutions such as web-sales front end, lease and loan origination and processing, vendor management, accounting, collection, reporting and risk management is heavily used among captive finance companies, yet it is still a minority approach for lessors.

Regarding the use of mobile applications, there is a significant difference between leasing and consumer finance businesses. Only a few lessors who answered the survey have developed mobile applications to run their business and they do not plan to extend it in the short term. Captive finance companies and banks responded with a resounding yes.

“The lending and leasing industry is once again in growth mode, but in a very complex environment and with very challenging requirements from their clients.” comments Mike de Verteuil, Business Development Director and Member of the Executive Board at Linedata. “More than ever, they need to be supported by innovative and flexible solutions to develop their business. Linedata is more than a software provider and has extensive experience as both system integrator and technology provider. We fully understand the business challenges of our clients and always propose the right approach to help them achieve their goals. ”

The survey was deployed online during the first half of 2014. The respondents included general management, IT, finance, and sales and marketing departments of retail and commercial banks, lessors, captive finance companies and specialized financial companies. The businesses covered in this sample are diverse: vehicle finance, equipment leasing, commercial lending, consumer finance, real estate finance, dealer inventory financing, fleet management. In terms of geography, 65% of respondents are North America-based, 27% Europe, 4% Asia and 4% across Africa and South America. In terms of size, the panel is made up of SME’s as well as big financial institutions.