The advent of open banking and the continuing emergence of new challenger and mobile banks is not limited to traditional banking. Asset finance is ripe for market disruption as specialist lenders move to target discreet market segments. The key to this changing landscape is the flexibility and availability of operating software.

Asset Finance software experts Copernicus’ MD Allen Jones reflects: “Specialist asset knowledge, combined with financing expertise is at the heart of challenger asset finance providers we expect to emerge at an accelerating rate.

“The people behind these emerging businesses know their markets and can provide a superior, appropriate and insightful customer purchasing and financing journey.”

The trend highlighted by Jones is already evident in the rapid emergence of specialist car leasing businesses. It is not just a lease that these businesses are selling it is expertise on the item and how to link finance and asset effectively in a frictionless manner, something that is very appropriate to the UK’s rapidly expanding, but time-short SME business sector. The result is a deeper bond of trust and respect than just the availability of money.

Allen points to the emergence of challenger businesses such as Countingup, which is targeting the UK’s 4.5 million sole traders, freelancers and contractors with a banking service with automated accounting services built-in as pointing the way for specialist asset finance providers. The business took just four months from inception to launch its current account.

The opportunity for specialist asset financiers is a similar one. The UK’s fast-growing SME market does not have or often need in-house procurement resources. What they need is trusted expert guidance and convenience. The emerging agile asset financiers, armed with market knowledge and focus on finance and asset have a natural service edge to fill the gap that exists.

What makes this type of venture possible is the increasing lack of barriers to market entry and the availability of affordable and flexible software to manage business operations, as Jones concludes: “A decade ago, the processing breadth and agility available to asset finance business from products such as our Solar asset finance system were unavailable.

“Today, we can have an asset finance business up and running in hours rather than months with all the necessary products, workflow and documents and complete with the accounting controls required to manage a finance portfolio.

“In today’s app-led world, customers want; speed, service, expertise, a frictionless buying experience and a fair price. I believe there will an increasing place for the type of nimble asset finance business that can provide this and inevitably this will accelerate a new level of market fragmentation in assert financing.”