What are credit unions going to do if they lose 40% of their auto lending portfolio?
It’s a difficult question to answer, and unfathomable to many. But is also a question that can’t be avoided, which is why the Filene Research Institute has been looking into how autonomous vehicles and dramatically different views on automobile ownership in the future will affect credit unions and their loan portfolios in the future.
Ryan Foss, managing director of innovation at Filene, pointed to studies by some research firms that project that by 2030 40% of financial institutions’ auto lending business will disappear as the result of autonomous vehicles.
“Even today, a lot of the carmakers are already getting into iPhone types of subscription services,” said Foss. “Volvo, for example, lets you pay a subscription and get a new car every year. You take a look at the changes and trends in the automotive industry and you say, ‘How can credit unions get involved in them?’ We don’t have the answers yet, but we are looking into this at Filene. That is what one of our i3 teams is looking into—if credit unions were to lose 40% of their auto lending business, what is available today that can help us prepare for that and actually be a leader in that disruption?”
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