Digitalization is needed, but relationships and consulting are the pillars of leasing

Luc Williams

These conclusions come from the debate “SME customer expectations – trends and challenges”, which took place during this year's European Financial Congress in Sopot.

The introduction to the debate was given by Ernest Pytlarczyk, chief economist of Bank Pekao SA. As his statement showed, the next two years are to be very good for the Polish economy. According to the presented forecasts, the GDP dynamics this year will amount to 3% and next year it will significantly exceed 4%. High wage growth and a rebound in consumption are forecast, but also high interest rates will remain high.

How will small and medium-sized enterprises, so important for the economy, cope in these conditions?

– Small and medium-sized enterprises are the salt of the Polish economy, but this salt has the problem that it has poor investments and poor innovation. Polish companies operate in quite traditional sectors and compete mainly at the expense of labor, said Ernest Pytlarczyk.

In addition, there are pressing succession issues and pressure from large corporations to take over.

– If a company does not have a well-planned succession, it is difficult to expect the owner to invest in it because he is thinking about selling it – concluded the expert.

Research by the Polish Leasing Association shows that clients from the SME sector expect a comprehensive, personalized and fully digitized service process from the leasing industry, as well as support in achieving ESG goals, such as energy transformation or vehicle electrification.

Tomasz Kisiel, member of the management board of Pekao Leasing, emphasized in the discussion that a client from the SME sector must be looked at very broadly and his needs must be accurately identified.

– He comes to a financial institution with a need, starting from a start-up, and expects financing in a simplified form. He expects that the equity he brings in from a previous employment contract is used as little as possible so that he can allocate these funds to pay his employees. And leasing is the tool that helps in this, financing the simplest assets such as a car or IT equipment – he said.

Leasing also supports the development of the company at subsequent stages.

– When a company transforms, becomes larger, invests in machines and production lines, it has no experience in negotiating their purchase. Leasing is perfect here. We have experience, we take over the role of negotiator of asset sale agreements or repurchase guarantees, and the client is provided with attractive and safe financing, said Tomasz Kisiel.

He pointed out that the leasing industry was greatly helped in the digitization of services by the coronavirus pandemic.

– We provided very professional service tools such as a sales platform and a customer service platform. When it comes to innovation, our benchmark that we would like to reach is the level of investment that banks have made in offering installment loans to individuals, he pointed out.

Tomasz Kisiel emphasized the need for partnership relations with small and medium-sized enterprises.

– I think that an SME client needs not only professional input, advice, and a ready-made offer, but also an approach as a partner. Large enterprises have human resources and partners from the financial industry who devote more time to this relationship because it concerns large transactions. The SME client also requires attention and time. This is a win-win, regardless of the improvements we would like to introduce, said the representative of Pekao Leasing. – We would like to sign contracts in accordance with the law in a form other than a wet signature or electronic signature, for example with an SMS code or code approval in the application – he described.

A very important demand that has been going on for some time is to enable the leasing industry to perform e-registration of cars.

– Our industry finances cars, leasing is growing more and more. There was a moment when renting became more popular, but this year we are seeing a rebound and it is 26%. dynamics in leasing new cars for companies. It is very important that these e-registrations speed up – emphasized Tomasz Kisiel. As he said, this will allow for savings and an even better adjustment of the offer to customer needs.

According to the debate participants, another demand is to equate leasing with credit when it comes to access to subsidies and aid programs.

What will the leasing industry look like in five years?

– We will be in the process of replacing technological investments that SME companies were implementing until the COVID-19 pandemic, it will be time to replace this machinery. It will also be a time of increased demand for equity capital. In my opinion, in the next year or two there will be no surpluses that build capital, it will have to be provided by the banking sector. This is also a challenge for the leasing industry. A good balance will be necessary between own contribution, financing duration and business projections. Because the natural simple growth associated with the cheap cost of employing an employee is ending. In five years, SMEs will invest in broadly understood automation projects combined with AI – concluded Tomasz Kisiel.

In 2023, the leasing sector financed assets worth PLN 102.5 billion. In the case of small and medium-sized enterprises, it was more than half of all financing that this segment currently has open. Over 60 percent SME companies in Poland finance their investments with leasing.

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