In the 1970s, vehicle titling and registration was a manual process. Mountains of paperwork from the buyer went straight to the dealer. Then to the bank. Then to the county. Then to the state. Then it all went backwards, through the exact same points.

Fast forward almost fifty years to 2018, and not a lot has changed in the world of title and registration. While many elements of our society have gone fully digital, from music consumption (iTunes, Spotify) to banking (Mobile apps, Zelle) to retail shopping (Amazon), getting a vehicle title and registration is all too often a manual, time-consuming process.

Purchasers, dealerships, banks, and state/county offices all still plow through endless paperwork. Consumers still complete mountains of paper applications, banks and auto lenders still have to manually calculate fees based on location, and those state and county offices still have to receive, review and process applications on paper. We are closer to flooding the streets with autonomous cars than we are to digitizing the title and registration process.

The big question: Why? The answer: there has not been a comprehensive, unified platform to facilitate the digital evolution of title and registration services. Until now.

Setting the Stage for Title Change

Yes, there are individuals and organizations who still process title and registration paperwork on a table, with a cup of coffee in one hand and a cigarette in the other. But to be fair, there are elements of title and registration that are moving into the modern, digital age. In fact, “[m]ore than half of US jurisdictions have some form of title and registration solution available”.[1]

And in some of those locations, dealers who pass a pre-determined volume threshold are required to use the digital portals.[2]

As you can imagine, state and county entities that use electronic title and registration enjoy enormous benefits.  Central processing is easier and more efficient, fee collection is accurate and timely, and field offices have increased capacity to undertake more high-value tasks. For dealers, benefits include improved customer service, efficiency, and a reduction in errors attributable to manual mistakes.

From the consumer perspective, automating and digitizing the title and registration process is a logical and overdue change. Modern consumers expect transactions to be easy and intuitive, and they don’t want to spend hours in line or have to drive to multiple offices to get their documentation completed. A digital, automated title and registration process benefits consumers by increasing satisfaction, being easy to use and providing the ability to handle all title and registration transactions in a single location.[3]

Change = Improved Satisfaction and Profitability

By looking at the impacts of the digital transformation and automation of banking services in general, we can start to draw some conclusions about the potential repercussions of automation for automotive title and registration.

The customer experience stands to benefit dramatically by increased automation and digitization. Financial institutions that provide digital, mobile banking services have seen improvements in customer satisfaction, as noted in a blog post by Jim Marous:

“Mobile banking has an impact on overall customer satisfaction as well, according to JD Power. As shown, there is an immediate lift in overall satisfaction when consumers use mobile banking (+27 points on a 1,000-point scale), with an even greater impact when banks provide their mobile banking customers with a highly satisfying experience (+82).”[4]

Applying the same model to title and registration, dealers and financers who bring digital technologies to the table and work to automate most or all of the process could drive significant increases in customer satisfaction.

As we look at the profitability gains that FIs have seen through automation and digitization, the case becomes even stronger for applying the same model to titling and registration. According to an article by Bain Insights, featured in Forbes:

Each mobile interaction incurs a variable cost of about 10 cents, compared with $4 for a teller or call-agent interaction…

When interactions migrate to mobile, a bank needs fewer tellers and call-center agents. So the largest U.S. banks would save $11.4 billion annually in aggregate…[5]

Let’s apply that same logic to the world of automotive title and registration. In banking, mobile interactions cost 2.5% of a typical face-to-face, manual interaction. For title and registration transactions, we will assume a more conservative approach and say automation can bring digital interaction costs to 60% of face-to-face, manual interactions. Current vendor fees for title and registration transactions range from $20 and up, on top of state and county fees.

By reducing those vendor processing fees by 40% (again, conservatively), lenders and dealers can enjoy significant savings. And when you factor in the volume of titling and registration transactions, the savings become quite attractive.

In their 2016 NADA Data report, the NADA reported that 32.5 million new and used cars were sold through franchised new-car dealerships. Using that volume of both title and registration transactions, and an average cost savings per transaction of $8, dealers and lenders are facing a potential windfall of roughly $260 million. Those dollars would go directly to the bottom line, while dealers and lenders would also improve the customer experience.

Change Agent: The Right Platform Partner

As we discussed above, the actual process of title and registration hasn’t changed much in the last 50 years. Until now.

At Zoot, we saw an opportunity and a need to improve and automate the way title and registration happens. Using our powerful, automated decision engine as the foundation, we developed a unique new approach that enables lenders and dealers to route the entire process through our decision engine.

Part of our value in the title and registration process is our unique ability to service all 50 US states. No matter where you do business, when you partner with Zoot, you can reduce processing time, increase throughput, and enjoy fully transparent auditability in the entire title and registration cycle. Our proprietary platform lets you send application details directly through an API connection to our system, then step back as we handle the rest of the transactions.

[1] Mehall, K. (2017, October 24). Electronic Title and Registration Benefits [PDF]. AAMVA.

[2] Mehall, K. (2017, October 24). Electronic Title and Registration Benefits [PDF]. AAMVA.

[3] Mehall, K. (2017, October 24). Electronic Title and Registration Benefits [PDF]. AAMVA.

[4] Marous, J. (2016, May 02). Mobile Banking Drives Satisfaction and Growth. The Financial Brand. Retrieved January 30, 2018, from https://thefinancialbrand.com/58703/mobile-banking-satisfaction-growth/

[5] Insights, B. (2017, February 13). Unclogging The Branch And Call Center Traffic Jam. Forbes. Retrieved January 30, 2018, from https://www.forbes.com/sites/baininsights/2017/02/13/unclogging-the-branch-and-call-center-traffic-jam/#59296a3a6597[/vc_column_text][/vc_column][/vc_row]