The financing industry has been disruptively impacted by recent years digitalization: technology has simplified the process (through high availability self-servicing), has reduced the latency to have a financing approval (“time to yes”), and has enabled more sophisticated products to appear. For instance, bundled products including the financing of an asset combined with several services such as maintenance and insurance, are becoming very common.

During the last two decades, innovation was high in the customer acquisition channels, namely the front-office. Recently, innovation is touching new models that deliver value to customers beyond the traditional multi-channelling: additional features such as “buy now, pay later” or “pay-per-use” are some examples.

Moreover, as a global trend, the clients expect a more sustainable consumption, which implies shifting from the notion of property towards the notion of shared consumption. Pay-per-use popularity is a direct consequence of this shift and will undoubtedly create a virtuous cycle that will make the manufacturers improve the quality and the lifetime of the goods.

Basikon offers a fully digital platform to manage the entire lifecycle of loans and leases, including such recent features.

A platform ready for "pay per use" use case

Basikon platform is ready for PPU with a solved challenge of connectivity.

First, the inherent flexibility of the subscription request enables the customer to apply for a financing related to an asset with the PPU option directly at the shop or e-shop. PPU is a configurable parameter of the product, linked to a prime billing element. Different types of metrics can be used depending on the type of usage (for example: number of items processed/manufactured, Km, Hours of usage…).

As for all leases, after scoring, validation and signature, the leasing is granted, and the customer receives his asset.

The asset is equipped with a specific IOT device that monitors the usage of the asset. As the customer uses his asset, usage data is sent by the IOT device to a data repository for further use.

Periodically, the data repository is accessed, and the amount of the instalment is computed based on the actual asset usage and billed. Then, direct debit generation, accounting, reconciliation, and collection processes are identical to non-PPU contracts.

Access to usage data is available to different stakeholders such as the customer, the company who sold the asset, the service providers, and the leasing company, which brings transparency in the benefit of all parties. Furthermore, the data collected can help making a better re-marketing of the asset at the end of the contract.

Basikon had the opportunity to meet with IOT device companies, and to make successful POC on PPU. The IOT device is delivered by specialized providers, either directly to you or via Basikon.

The outcome is that, within a few weeks, an infrastructure that supports PPU can be set up, combining Basikon platform, IOT devices and a repository with data collected by the devices.

A trigger for system modernization

We observe that the platforms that are in use today are very rich in functionalities to address the current business of B2B2X stakeholders. However, in many cases, their design and technology limit the innovation possibilities, either because they are monolith systems or because they come from a back-office world that slowly evolved towards front-office world. In these cases, no matter which route is selected, the technology debt is so high that it is impossible to transform the platform into a fully digital platform.

This is the main reason that triggered Basikon to develop a completely new state-of-the art fully digital platform. It is natively digital and the benefits from digital, historically exclusively used for the front-office step of the overall process, are now available to the entire overall process.

Many financing companies are reluctant to a one step full migration of their activity to a new platform, for risk and delay reasons. And we fully understand that. However, we believe that PPU represents a real opportunity to make a first step towards a complete renewal of the loans and leases management system.

This platform that can be up and running in a few weeks.