Krungsri Auto, a vehicle loan unit under Bank of Ayudhya, is beefing up its digitalisation efforts to grow its car loans this year.
According to Kittiya Srisanit, head of Krungsri Auto Group, despite lingering challenges from the pandemic, digitalisation and collaboration with partners are the key strategies to facilitate the company's business growth this year.
Krungsri Auto is aiming for 173 billion baht in new bookings of car loans this year, up 11% from 2020.
Mrs Kittiya said online channels covering digital platforms are expected to contribute 4% of the company's total new auto loans this year, a rise of 2.4% over last year.
The company has vowed to develop innovative digital platforms and new features responding to the requirements of all related-parties including customers and business partners.
It launched a car loan digital platform, Go Application by Krungsri Auto, in November of last year and added a new feature in January called KANA, which provides advice about personal accident insurance. It also adopted the iPartner platform, offering services and information to used car dealers.
After the launch of the Go Application, the company reported its digital loan approval via the platform had reached around 60-70 million baht.
Despite double digit growth in new loan bookings, the company is still only expecting a marginal growth rate of total loans outstanding due to the ongoing pandemic.
Krungsri Auto aims to expand its total car loan portfolio to 428 billion baht this year, a rise of 1.2% from 423 billion baht in 2020. Paying attention mainly to asset quality, it aims to control the non-performing loan (NPL) ratio at no more than 2% this year.
"Amid the pandemic, we've slowed down our loan offerings to some customer segments hit hard by the pandemic. We can contain our bad debt ratio at a satisfactory level while maintaining the rejection rate of loan products," she said.
Mrs Kittiya said Krungsri Auto is ready to provide debt relief measures to customers who are not able to pay debt as normal due to the impact of the pandemic on a case-by-case basis. It has offered several debt-aid programmes to around 90,000 car loan borrowers who have been impacted by the new wave of the pandemic in December of last year.
With improving economic activity thanks to the government's effective measures to contain the pandemic, around 80% of all customers who applied for the debt relief measures have been able to manage to exit the financial aid programme.
Mrs Kittiya said the country's private consumption and investment are showing signs of recovery. With this scenario, the company expects to see a gradual recovery in the new car market, with estimated annual sales of 810,000 units, an increase of 2.5% over 2020.
The overall auto finance market is also expected to grow at a comparative level of 1.5%, with a projected total market value of 494 billion baht this year.