Group forecasts boom in business spending

by Madison Utley20 Oct 2020

A tech group popular amongst brokers has aggregated data from the past several months to model the trajectory of business spending for the remainder of the year and beyond.  

As a second-hand asset finance verifier, the volume of requests received by Verimoto helps to illuminate the current appetite for spending within the market; the requests are received through the group’s smartphone application as buyers seek to verify an asset, its location and the identity of the vendor in order to request financing for the asset from a lender.

September marked the fourth consecutive month of growth in demand for second-hand assets, up 22% from August; when considered alongside the government’s significant concessions for business outlined in the 2020 Federal Budget, Verimoto is confident business spending will continue its upward trajectory.

The second-hand market seems particularly primed for growth as businesses remain financially savvy in the face of pandemic-induced economic stress, according to Verimoto CEO Peter Hewett.

“The combination of restricted new car supply, frugality and increasing prices in the used car market means financing for second-hand vehicles will increase over the coming months,” said Hewett.

“This will require brokers to be able to service this increase demand for second-hand asset financing to benefit from the growth in the market.”

 
 

Vehicles were the main contributors to the second-hand asset growth evidenced in September. The supply chain issues created by the pandemic have impacted the new car market to the extent that prices in the used vehicle market are increasing, according to figures from data analytics firm, Datium Insights.

The Verimoto data revealed another trend within the space to watch over the next several months: the rise of the caravan. Verification requests for the asset class grew by 18% over the month.

“Brokers can expect to see caravan sales continue to increase over the coming months, as Australians look for alternative, affordable ways to holiday,” said Hewett.

“With caravans being a large purchase, it is likely many will opt to be frugal and purchase second-hand on finance.”