How Car Dealers Influence Finance in Australia (2025 Guide)

In 2025, buying a car in Australia is more complex than ever—and much of the complexity comes from the dealership floor. Dealers aren’t just handing over keys; they’re often the gatekeepers to how you’ll finance your next set of wheels. With major regulatory shifts, digital platforms, and a new push for transparency, understanding a dealer’s influence on your car finance is essential for every Australian looking to get the best deal.

The Evolving Role of Dealers in Car Finance

Traditionally, dealers made their money from selling cars and upselling extras. In recent years, however, finance commissions and in-house loan products have become a significant revenue stream. As of 2025, nearly 60% of new car buyers in Australia arrange their finance directly through the dealership—a figure that’s held steady despite the rise of online lenders.

• Dealer-arranged finance: Dealers act as brokers, connecting buyers with banks, captive finance arms (like Toyota Finance or Volkswagen Financial Services), and non-bank lenders.
• Bundled products: It’s common for dealers to offer loan protection insurance, extended warranties, and even gap insurance as part of the finance package.
• Digital disruption: Many dealers now use online finance pre-approval tools and instant loan calculators, making it easier for buyers to compare options—but also to commit quickly.

With the Australian car market rebounding in 2025 after supply chain challenges, dealers are leveraging finance deals as their main competitive edge. Zero percent interest offers, cashback incentives, and flexible balloon repayments are everywhere—but so are the hidden catches.

2025 Regulatory Changes: More Protection, More Complexity

The Australian Securities and Investments Commission (ASIC) and the Australian Competition and Consumer Commission (ACCC) have cracked down on dealer finance practices in recent years. In 2025, the National Consumer Credit Protection (NCCP) reforms have brought further changes:

• Ban on flex commissions: Dealers can no longer adjust loan interest rates for higher commissions. Instead, rates must reflect your credit profile and lender criteria.
• Mandatory disclosure: Dealers are required to clearly outline all fees, commissions, and kickbacks received for arranging finance, helping buyers make informed choices.
• Cooling-off periods: New regulations grant consumers a two-day cooling-off period for dealer-arranged loans on new and used vehicles.

These changes mean consumers are better protected, but navigating dealership finance is more layered. Loan contracts are longer, more detailed, and packed with fine print. The upshot: Australians need to be more vigilant than ever before signing anything in the showroom.

Smart Strategies for Australians Dealing with Dealers

So how should you approach dealer finance in 2025? Here’s what savvy Australians are doing:

• Get pre-approval elsewhere first: Secure a quote from your bank, credit union, or an online lender before visiting the dealership. This gives you a benchmark and bargaining power.
• Compare apples with apples: Focus on the total loan cost—including fees, charges, and extras—rather than just the monthly payment or headline rate.
• Scrutinise bundled products: Some add-ons (like gap insurance) can be valuable, but others are overpriced or unnecessary. Always ask for itemised quotes.
• Negotiate everything: From the car price to the finance rate and even dealer delivery fees—everything is on the table in 2025’s competitive market.
• Use the cooling-off period: Take loan documents home, read the fine print, and don’t be pressured into signing on the spot.

Real-world example: Melbourne buyer Sarah secured a better deal by showing her bank’s pre-approval to the dealer, who matched the rate and threw in free servicing. She declined the expensive loan protection insurance after reading the PDS at home—saving over $1,200 in unnecessary premiums.

What’s Next for Dealer Finance?

With electric vehicle (EV) adoption surging and new car subscription models emerging, expect dealers to push innovative finance packages in 2025. Some are teaming up with fintechs to offer ultra-fast approvals and app-based repayments, while others are experimenting with ‘flexible ownership’ plans that blur the line between leasing and buying.

For Australians, the key takeaway is this: dealers can offer convenience and competitive finance, but only if you walk in informed and prepared to negotiate hard. Take advantage of new protections, compare all your options, and don’t be afraid to walk away if the numbers don’t stack up.