Motoring News

SA vehicle finance ‘on cusp of a revolution’. How come?

JOHANNESBURG, South Africa – Younger folks’ expectations from financial institutions are changing rapidly as they seek to accumulate assets, including automobiles, according to Ghana Msibi, WesBank’s CEO of Motor.

He expects vehicle finance to evolve more through the coming five years than it did through the previous four.

Generally, he believes, Baby Boomers and Generation X were regarded as ”saving” age group intent on owning large assets such as cars and houses while Gens Y and Z prefer paying for use without the risk associated with ownership.


Subscription services were becoming a lifestyle trend banks could not ignore and the way the youth buy food, shop for clothes, even watch TV, would influence banking deals to acquire – or at least use – big-ticket items, short term.

Television, Msibi suggested, was an example: ”South Africans previously had access to a one-size-fits-all satellite package, online streaming afforded near-limitless viewing options, so why pay a premium for a number of never-watched channels?

”More affordable streaming services with broader programming and tailored playlists are available at the click of a button, are available and in a short time streaming services have revolutionised TV at lower cost.”

Ghana Msibi, WesBank’s CEO of Motor

So, Msibi asked, how does this translate to vehicle finance? ”WesBank will continue to offer traditional installment options but our industry  needs to evolve greater flexibility when it comes to subscription or pay-for-use packages.

”Why should a customer with no intention of owning a vehicle at the end of a finance agreement be held to the same or similar terms as a customer who does?”


In a way, Msibi, suggested, such a concept was already in place through future value programmes – however an evolution and improvement in pay-for-use arrangements were on the horizon…

He suggested shared mobility as another area to consider for one-vehicle finance.

Msibi explained: ”This would mean affordability calculations based on multiple incomes to subscribe to, or eventually own, a car. We offer this in spousal arrangements but are looking at how to roll it out with more flexibility.”


The expansion and development of digital tools was an obvious necessity, he added, as customers now expect immediacy and personalised interactions.

”Stacks of documents for application processes are considered old-fashioned,” Msibi said. ”And they’re and unnecessary in today’s transactions. Banks have intimate understanding of customers’ financial situations so the responsibility of affordability calculations should rest more with banks and financial institutions and less on customers’ shoulders.”

While existing online calculators and budgeting tools already offered convenience customers didn’t have a decade ago Msibi believed much more admin could be done in the back office.


Msibi added: ”That would make a buying journey far simpler. Conventionally, a buyer will browse for a car then approach setting foot on a dealer floor so would expedite processes to the extent of perhaps driving away in a new car in minutes instead of days.”

Historically speaking, Msibi added, banking systems did not have the flexibility of today. Systems for finance arrangements were built on tried, trusted, traditional, money-lending.

”As with so many industries,” he concluded, ”we’re evolving with the times. WesBank is travelling a fast-paced journey with customers’ newfound expectations leading the way. Our intent is to cater for new demands and significant investment to develop new business methods.”

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