The American Financial Services Association (AFSA) announced on May 13 that it has published new industry guidance aimed at reducing inefficiencies in the vehicle loan payoff process and encouraging more standardized procedures between dealerships and lenders.
The guidance focuses on challenges that can arise when dealerships work with multiple banks, credit unions, and captive lenders that each use different portals and payoff systems. AFSA said these differences can create delays and add administrative work to routine transactions.
In its Industry Expertise article, AFSA said dealerships often process 20 to 30 vehicle loan payoffs per day across different lenders, requiring staff to switch between multiple systems and workflows. It said more consistent payoff processes could help speed up transactions and reduce friction for both dealers and lenders.
Vehicle-finance companies contributed $125.5 billion to U.S. gross domestic product in 2023, supported about 680,000 jobs, generated $24.6 billion in tax revenue, and originated 30.2 million vehicle loans and leases worth $727 billion, according to AFSA.
Founded in 1916, the American Financial Services Association (AFSA) describes itself as a leading trade association for the consumer credit industry. Its members include more than 410 companies offering installment loans, auto financing, mortgages, payment cards, and retail credit, but do not provide payday or vehicle title loans. The association also promotes financial literacy through its education foundation and engages with lawmakers and regulators on policies affecting consumer credit.
