Q2 digital contracting growth mirrored accelerated auto sales activity; Auto securitizations saw a decline following auto ABS losses
Adoption of digitized contracting and documentation workflows by auto retailers and their lending partners that foster back-office efficiencies saw a continued upward trend that mirrored auto sales activity, according to analysis by Wolters Kluwer Compliance Solutions from its Q2 Auto Finance Digital Transformation Index
"The Q2 2025 Auto Finance Digital Transformation Index clearly underscores the imperative for digital workflow adoption in the auto industry," said Matthew Babcock, Digital Lending Product Strategy for Wolters Kluwer. "From significant operational efficiencies to enhanced customer experiences to faster transactions and reduced paperwork, digitization is providing the strategic advantages that are foundational to the future success and resilience of auto finance."
Key Findings from the Q2 2025 Index:
eContracting (Auto): Digital contracting in auto finance continues its upward trajectory, underscoring the industry's ongoing commitment to streamlined, paperless workflows.
- Quarter-over-Quarter Growth: eContracting volume increased by 7.07% from Q1 2025 to Q2 2025.
- Year-over-Year Growth: A notable 9.26% increase was observed from Q2 2024 to Q2 2025.
- Four-Year Trend Positive: The long-term trend highlights substantial digital adoption, with a remarkable 116.26% growth in eContracting dating back to Q2 2021.
This consistent growth in eContracting during the second quarter aligns with the overall U.S. auto sales activity, which saw the forecasted new-vehicle sales pace in June finish near 15.3 million, up from 15.0 million in June 2024, as reported by Cox Automotive.
Securitizations (Auto): Digitalauto securitization activity also mirrored broader auto ABS trends and experienced a noticeable downturn in Q2 2025, though the longer-term view still indicates overall growth.
- Quarter-over-Quarter Decrease: Digital auto securitizations decreased by 46.21% from Q1 2025 to Q2 2025.
- Year-over-Year Decrease: A more substantial 55.26% decline was recorded from Q2 2024 to Q2 2025.
- Four-Year Trend: Despite recent quarterly declines, the four-year trend shows an overall increase of 22.91% since Q2 2021, indicating that the market has grown considerably over this period, even with recent fluctuations.
Amid months of market uncertainty, auto ABS issuance dropped 37.2% YoY to $9.8 billion in May, according to JPMorgan Securities data. Year to date through May 16, prime loan issuance fell 14.4% YoY to $31.5 billion, while nonprime loan issuance rose 6.7% YoY to $17.4 billion, according to JPMorgan. Total issuance landed at $68.3 billion YTD, down 12.8% YoY.
Wolters Kluwer Compliance Solutions, which sits within the Wolters Kluwer Financial Corporate Compliance (FCC) division, is a market leader and trusted provider of risk management and regulatory compliance solutions and services to U.S. banks, credit unions, insurers and securities firms.
About Wolters Kluwer
Wolters Kluwer (EURONEXT: WKL) is a global leader in information, software solutions and services for professionals in healthcare; tax and accounting; financial and corporate compliance; legal and regulatory; corporate performance and ESG. We help our customers make critical decisions every day by providing expert solutions that combine deep domain knowledge with technology and services.
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