REX: Finnocar Enters the Market for Financing Second-Hand Vehicles

FACTS

• Finnocar –start-up featuring financing and insurance tools for car industry specialists– reports results for their first three months.

• This FinTech chiefly addresses second-hand car dealers with tools helping them them sell cars:
  • Financing options: loans, lease-purchase contracts and long-term leasing options;
  • Insurance policies: extended guarantees, warranties covering mechanical failure and car insurance.
• In order to come up with a wide range of services, Finnocar relies on banking partners such as Société Générale, Banque Casino and BNP Paribas. 
• This start-up also provides customers with a full-digital subscription process.
• Finnocar charges a fee on financed amounts. This commission is split between the banks and car dealers using their service.

Key Figures

• 2019: Finnocar was launched
• 250+ car dealers relying on Finnocar
• €8M in credit applications
• €2M in granted loans
• Goal: increase production twofold each month

CHALLENGES

• Addressing a shortfall of financing options for used cars. Finnocar mostly intends their service for second-hand car dealers as they deem that the market for new vehicles is already relevantly covered and features enough financing options from industry specialists.
• Heading into the leasing market. In partnership with Lease Plan, they plan on launching an offer in H1 2020. They would mainly target younger customers and people familiar with digital channels.

MARKET PERSPECTIVE

• Finnocar only gets started with selling their service and will be betting on more banking partners to grow. They are incubated at Moove Lab’, and discussions would be underway with Autorigin, CapCar as well as CGI Finance. Partnerships with Autocerfa and Zoomcar are expected to be announced fairly soon.
• This start-up will be relying on quite a dynamic market (selling used cars) to secure their position. All the more so that this sector now covers all sales channels, including online.
• Yet another goal: by 2021, they intend to integrate their partners’ stocks, so prospects may start applying for a financing options before looking into the used vehicles most suited to their needs.