Entrepreneur John Symond to attack car loan market
Wednesday, October 10, 2007/
Entrepreneur John Symond is not concerned that the credit crunch could be about to dent his home mortgage business. Instead he reckons the timing is perfect to launch a fresh assault on the traditional banking sector.
Symonds has announced that Aussie Home Loans will offer car loans and personal loans and is determined to wrestle three to four per cent market share of the $30 million industry away from second hand dealers and banks within a year. “We plan to double that the second year,” he told SmartCompany.
Aussie Home Loans will offer secured and unsecured personal loans at up to two per cent below that of the top banks.
He says Australians spend $2.5 billion a month on car and personal loans. “In the old days it was a competitive market with companies like Esanda fighting for your business. But those days are gone and people have to rely on big banks and motor car dealers.”
And that is all classic Symond territory. Symond built Aussie Home Loans from a small office in Sydney selling home loans before moving into mortgage broking. Forays into real estate franchises and superannuation were not as successful but a move into credit cards last year fared better.
Symond, 59, who is worth almost $600 million according to the BRW Rich List, still loves to play the role of the battler sticking it up the big boys.
And second hand car dealers are easy prey. “About 50% of people who take out car loans are under 32. Car dealers can take advantage of the inexperienced demographic.”
There is also a growing market of people selling their cars directly to another consumer. “But banks won’t lend if you are buying from consumers instead of a car yard.”
He says people can get approval from Aussie within minutes and then go and bargain with car dealers with confidence. “They no longer need to be intimidated,” he says.
Symond is planning a soft launch before Christmas with online advertising before gearing up next year. A call centre has been set up in Sydney to focus solely on car and personal loans.
Meanwhile BankWest wants to shake up bank branches, announcing it will provide new retail inspired branches as part of its aggressive move on the east coast.
BankWest will offer a relaxed café style. People will be offered coffee and can browse books or play in the internet. Kids will be entertained with toys and DVDs while parents sit in open teller pods instead of lining up to stand at the traditional counter.
Traditional counters will be replaced with open teller pods and coffee, music, toys and DVDs for the kids will all be on offer.
It will be interesting to see if the branches, set to open seven days a week, can shake off their image as unpleasant places to be.