Asset Finance International: As a leading Nordic supplier of software solutions to the asset finance industry, what are your views on the steps European leasing companies are or should be taking to benefit from technological innovation?

Pedram Tadayon: We see four key trends:

1. The Internet of Things (IoT) is becoming an essential part of the leasing strategy – machines and back-office systems are finally tightly integrated. IoT enables companies to maximize total cost of ownership, operating expense (OPEX) spending, service sales optimization and helps with customer retention.

2. The lower cost of origination due to highly automated leasing software should enable asset finance companies to gain competitive advantage and stay profitable through workforce improvements. The freed asset can help companies to realize a shift in focus from back-end to front-end activity.

3. Geographical expansion is no longer being held back due to expensive implementation projects; most leasing software scales horizontally and vertically without adding complexity, which enables growth without added infrastructural cost.

4. Machine learning and analytics − the use of more advance analytics is no longer the preserve of artificial-intelligence researchers and born-digital companies like Google, LinkedIn, AirBnB and Uber. It’s moving into our industry and fast.

AFI: Is leasing technology being updated fast enough in the post-recession environment in Europe? Are lessors being held back by out-of-date technology?

PT: The biggest threat isn’t in outdated technology; most lessors have realized the advantages of having state-of-the-art technology for their core business. The threat is within business development: we’ll see a change in the leasing landscape where the sharing economy will be a bigger part of it. We see new players popping up with innovative business models (i.e. Zipcar, Car2Go, DriveNow) − they’re gaining market share and they’re here to stay.

AFI: How best can these leasing companies exploit the increasing interconnectedness of their markets?

PT: Interconnectedness has almost eliminated trade barriers and leasing companies are gaining comparative advantage, enlarging financial revenue by generating business in other countries. We at Emric have been helping asset finance companies to do that for years with our multi-local solution, and we’re constantly improving our SaaS deployment to enable seamless geographical expansion.