An operational pivot is needed
Captive finance providers are facing unprecedented pressure. Customers expect flexible, digital-first finance journeys, OEMs are tightening control of the customer experience, and regulators are enforcing stricter standards on compliance and fair treatment.
At the same time, remediation has become essential. The UK motor finance mis-selling review has shown how legacy commission practices can create large-scale liability. Managing redress fairly and efficiently is now a defining capability for captives, not just a compliance exercise. Done right, remediation builds trust and strengthens brand reputation.
The challenge with legacy models
Most captive finance businesses were built on legacy assumptions: in-dealer sales, fixed ownership models, and decades-old systems. But the market has moved:
- 25% of customers now buy vehicles online without ever visiting a showroom. They expect personalised, subscription-like options.
- OEMs are expanding their direct-to-consumer role, linking finance more closely with sales and service to drive loyalty and lifetime value.
- Regulators are scrutinising finance models, from the Zero Emission Vehicle (ZEV) mandate to the FCA’s investigation of discretionary commissions.
As outlined in Axiologik’s recent Automotive Report, these trends are significantly impacting captive finance companies’ core IT and applications. But this goes beyond IT, and those who fail to evolve risk becoming irrelevant in a value chain moving faster than they are.
This creates a dual challenge: evolve quickly to stay relevant, and embed remediation processes that ensure compliance, transparency and fairness.
Why remediation must be built in
Legacy, fragmented platforms make it difficult to prove compliance or handle disputes consistently. The result is:
- Data silos that create inconsistent pricing or eligibility decisions.
- Compliance gaps where incomplete audit trails risk regulatory penalties.
- Customer frustration when claims or redress cases are slow or unclear.
For captive finance providers, this is more than an operational risk — it’s a reputational one. By embedding remediation readiness into core systems, captives can handle claims efficiently, protect trust, and prevent small issues from escalating.
Three principles for captive finance transformation
NTT DATA has built a proven framework with three guiding principles to help captives transform and ensure remediation is managed effectively:
1. Devolution: Empower agile teams
Transformation is not just about upgrading IT. It’s about empowering frontline teams with the authority and tools to resolve issues quickly, including remediation claims. Agile, cross-functional teams can reduce bottlenecks, create faster feedback loops, and ensure customer outcomes remain fair and consistent.
2. Collaboration: Build interoperable ecosystems
Captives must connect seamlessly with OEMs, dealers, and national sales companies (NSCs). That requires modular, API-driven platforms and shared governance structures. When remediation processes are integrated into this ecosystem, it ensures disputes are handled consistently across channels, with complete transparency for both regulators and customers.
3. Product mindset: Treat data as an enabler
With the right data strategy, captive finance companies can enable personalised pricing, develop risk-based subscription models for younger drivers and support new forms of ownership . For example, Gen Z consumers are more open to vehicle subscriptions and less interested in car ownership. This presents a largely untapped audience for many automotive brands.
These innovations only work if the data is accurate, accessible and actionable. That’s why data transformation needs more than dashboards – it needs evidence-backed investment, a clear business case and executive alignment from the start.
The strategic upside of remediation
Handled strategically, remediation becomes a differentiator by creating
- Customer trust: fast, transparent redress turns a complaint into an opportunity to deepen loyalty.
- Regulatory confidence: clear processes and data-driven evidence reduce scrutiny and legal exposure.
- Operational resilience: scalable digital workflows lower costs and speed up resolution.
Create resilient, future growth
The pressures on captive finance — from digital customers, OEM strategies, and regulatory demands — will only intensify. Providers that act now will gain a competitive edge in the reshaped mobility landscape.
By embedding remediation into transformation strategies, captives can ensure they remain trusted, compliant and relevant. The winners will be those that combine flexibility, data-driven insight, and proactive remediation to deliver customer journeys that are fair, fast, and future-proof.
Download our report to see how NTT DATA’s framework is helping Captives deliver complex change, efficiently.