This week, Wolters Kluwer announced first quarter results and analysis from its Auto Finance Digital Transformation Index, a key resource that tracks the rate at which dealers, service providers and auto finance companies are seeing growth in the evolution from paper-based finance back-office processes to digital.

According to the index, dealers, service providers and finance companies showed a digital adoption growth rate of 12% during the first quarter compared with the fourth quarter of last year.

Wolters Kluwer said the growth rate of digital was essentially flat comparing year-over-year, which is in line with the lack of significant growth in vehicle sales activity over the past 12 months.

Wolters Kluwer experts said the annual spring tax-buying season may have contributed to the slight increase in digitized contracting during the first quarter.

“Clearly 2023 has remained a highly competitive environment where dealers and lenders remain focused on overcoming economic challenges to find sales and portfolio growth,” said Tim Yalich, head of auto strategy for Wolters Kluwer.

“We are not surprised that the growth of digitized back-office processes and documentation has slowed to also mirror vehicle sales activity, and we expect dealers and lenders are keeping a watchful eye on the progress of sales growth as they plan additional investments in digital,” Yalich continued in a news release.

Similar to last quarter, Wolters Kluwer is also offering in this report a spotlight on digital asset and workflow adoption in the securitization markets.

Securitized digital automotive retail installment contracts increased 32% in the first quarter compared to the same time last year, according to Wolters Kluwer.

What’s more, Wolters Kluwer indicated securitized digital auto contracts increased 317.85% compared to the fourth quarter.

Wolters Kluwer attributed the strong growth in securitized markets to the rising appetite in digitized origination in the secondary markets through added efficiency in the pooling, auditing, collateralization, and the execution of security exchanges using digital assets.

“Additionally, the more than 300% growth rate can also be attributed to a seasonality trend based on historical data as many lenders seek capital in the first quarter compared to the fourth quarter,” Wolters Kluwer said.

To learn more and to access additional data insights from the Wolters Kluwer Auto Finance Digital Transformation Index, go to this website.