Car finance: open banking tackles credit card pain points

New car finance incentives are a common way for dealers and automakers to attract buyers. With a 0% finance deal on the table it makes little sense for shoppers to dip into their own cash reserves. But these aren’t always available and are very often limited to new vehicles. For shoppers that cannot afford to wait around for a finance deal on their favourite brand or model, and for those in the used car market, credit card purchases are often the preferred method of payment, but these are far from ideal.

With lengthy waits for the transfer of funds, there’s usually no driving away in the new car on the day of purchase. More often than not, the consumer has to return to the dealer a day later once the payment has cleared. At the same time, dealers are slapped with Merchant Service Charges for card transactions. A 1% fee may not sound like much, but it quickly adds up over a high volume of high-value purchases. This is where open banking could make a big difference.