Krungsri Auto embraces new strategy, confident of keeping loan growth in 2017
KRUNGSRI AUTO, a branch of Bank of Ayudhya, will embrace the “digital customer experience” and collaborate with other segments of the Krungsri group as key strategies to increase competitiveness and to maintain high loan growth in the new year.
The auto finance provider believes it will be able to keep growing in terms of both new lending and outstanding loans in 2017 after doing better than the overall market in both of those aspects this year, said Pairote Cheunkrut, head of Krungsri Auto.
Despite a slowdown in car sales this year, Krungsri Auto enjoyed new loan growth of 6 per cent to Bt133 billion, while outstanding loans grew by 9 per cent to Bt277 billion.
The firm embraced relationships with auto dealerships and lending approval technology as key strategies to expand loan growth, while also providing financing in the used-car and motorcycle markets, especially the big-bike segment.
Digital solutions
Under its digital strategy, Pairote said there would be four steps. First, digital touch points would be established to allow transactions at any time, anywhere and with any device. Second, customers must be offered digital solutions directly from Krungsri Auto. The third step is the customer’s decision to apply for a loan, and the last step is customer engagement.
Pairote said that while traditional touch points with customers would continue to be important, the firm also wanted to become more competitive by riding the digital wave.
He said the second strategy for 2017 would be collaboration within the Krungsri Group, using its facilities to service its borrowers.
He added that while these strategies would help the company maintain lending growth, car sales were set to recover next year, so competition in the auto finance sector should become more intense.
Motorcycle segment
Some of that tougher competition would be in the motorcycle segment, as its high growth was attracting more players in the market, he added.
Domestic car sales in 2017 are expected to grow by 3-5 per cent from the sales of 750,000 units expected this year.
The slump in the auto sector has probably bottomed out, Pairote said.
Meanwhile, Krungsri Auto is assigning the management team at its joint-venture company in Laos to conduct a feasibility study on expansion. to expand lending to other vehicles after achieving new car loan in the market.
Krungsri Auto set up the JV company two years ago and it is expected to break even by the end of this year, earlier than 2017 as previous anticipated.
