The financial partner of the automotive industry, Auto1 FinTech (FT) has become the first European firm to introduce smart contracts on the Ethereum blockchain into its car financing processes.
According to the press release published on Thursday, the company noted that Ethereum smart contracts will replace the traditional, paper, and manual procedures to ensure efficiency, effectiveness, and safety in the processing of its car financing.
The company’s Managing Director, Taimur André said,
“Our digital solution brings enormous efficiency benefits for car dealers and is setting new standards in the mobility industry. Using smart contracts reduces the total expenditure and documentation involved in financing a car to a minimum.”
The Berlin-based company noted that Ethereum smart contracts will be used throughout the life cycle of cars, ensuring added efficiency and security while still maintaining the already-existing user interface and general procedure.
Additionally, the smart contracts will contain every contractual detail of the vehicle including the checkbook, vehicle history, payments, and former ownership.
This move will make Auto1 FT become the first car financer in Europe to convert its entire ecosystem to this method.
Commenting on the development, Nuno Vaz, Head of Information Technology at Auto1 FT said:
“Smart contracts are based on the outstanding properties of blockchain: they are tamper-proof, unalterable and transparent, and are verified by the community. This is what makes them so valuable for our purposes.”
This is not the first time Auto1 FT will be adopting blockchain technology. In June, it became the first company in the German automotive sector to issue a security token offering (STO) worth up to €4 million (~ $4.6 million) to accelerate digital innovations.
The cryptocurrency and blockchain industry is gradually revolutionizing several economic sectors, including the automotive industry. Several auto companies have adopted both crypto and blockchain in most of their designs.
Just a few months ago, the Canadian electric car manufacturer, Daymark rolled out a prototype of its Spiritus electric car which has a feature that allows it to mine crypto when parked.