July 1, 2023

Debunking the 5 Myths of Digital Titling and Registration

Rapid advancements in technology and digital systems have streamlined numerous industries, yet our DMVs remain stagnant with decades-old technology—largely due to manufactured fears fueled by myths and misconceptions that continue to surface in our media and among those within the industry. As the CEO of CHAMP Titles, a Cleveland, Ohio-based company and creator of the nation’s first end-to-end vehicle titling and registration solution, I will debunk five common myths associated with vehicle titling and registration, drawing upon both industry knowledge and the experiences of our users. Let’s set the record straight by navigating through the fog of misinformation with accurate insights.

Myth 1: Upgrading to a digital system is costly and complicated.

Several entities suggest that transitioning from outdated mainframes to digital systems for vehicle titling and registration requires a significant amount of investment in technology, infrastructure and staff training. In truth, this is just a way for consultants to charge fees for services that should be provided without cost. Our users experience minimal change management, with user training measured in minutes—not hours, days or weeks. If a person knows how to check out on Amazon, they will know how to use our technology. Furthermore, governments that enlist a product like ours can opt for pay-for-performance models, ensuring digitization without burdening their budgets.

Myth 2: Technical challenges hinder the adoption of digital systems.

While it is true that many DMVs still rely on outdated mainframe-based technology, clinging to these systems can create long-term challenges that require specific skillsets from individuals who are either retiring or quite literally passing away.

Building a new platform on top of a bad or an aging system, like so many states continue to do, is like constructing a house on top of a very fragile foundation. Eventually, the house will begin to fall apart, and the homeowner will be forced to fork out a lot of money to repair the damage. For vehicle titling and registrations, this can all be avoided by moving to a cloud-based system of record that is robust enough to handle transactions for the entire country from day one, effectively eliminating the dependence on fragile mainframe infrastructure.

Myth 3: Stakeholders, particularly auto dealerships, resist the transition from paper-based to digital systems.

The ongoing perception that stakeholders, including auto dealerships and title departments, are resistant to change and prefer the traditional paper-based system does not align with the reality on the ground. Title departments are often well-informed about the potential pitfalls of a poor system and are eager for new strategic and technologically advanced solutions, like fully digitized systems of record, that offer faster and more efficient vehicle transactions.

For example, the speed of moving a car from one owner to another is necessary for many transactions that did not exist even 10 years ago, including buying and selling a car online, paying off a loan and refinancing it online, or settling an insurance claim in minutes or hours as opposed to weeks or months. Retailers, as well as fleet owners, that rely on online sales are in desperate need of systems of record that can work at that speed. Their businesses depend on it, and the workers who deal with titles know this problem all too well. State governments, through digital title and registration systems, can bring these solutions to these industry participants and deliver a win.

Myth 4: Digital systems introduce legal and regulatory challenges.

Some believe that transitioning from paper to digital environments necessitates the recreation of personally identifiable information (PII) and compliance with new rules and regulations. However, this myth overlooks the fact that existing legal and regulatory requirements, such as data protection and privacy laws, still apply to digital titling and registration systems. In reality, digital systems can enhance security and fraud prevention measures by making it more challenging to deceive or manipulate information. The shift to digital does not nullify existing regulations; instead, it offers an opportunity to strengthen compliance and create a more robust and secure environment.

Myth 5: Launching a new title and registration system costs taxpayers too much and takes years.

It is a complete fallacy that launching a new title and registration system takes 4-5 years, as vendors have been suggesting for the last several decades. Those same government contractors charge tens of millions of dollars up front, and by the time their technology actually launches several years later, it is already on its way to obsolescence. Further, these same vendors often try to sell DMVs on the idea that everything needs replacing, not just the title and registration system receiving all the complaints. The reality is cloud-based systems focused solely on fixing the problems of the government constituents who deal most frequently with titles—vehicle retailers, lenders, fleet operators, insurance carriers, each one of these industry’s service providers, and of course consumers—can be launched within months. Further, embarking on the pay-for-performance model ensures that the government doesn\'t make any upfront payments. Instead, it charges users per transaction, ensuring that the costs are distributed fairly among those who benefit the most from the new system.

Finally, when a focused title and registration solution is launched, the industry sees change happen faster, which, in turn, encourages states to find more ways to work together on matters such as digital titles and titling. Interoperability between states is further spurred by entities like AAMVA and AFSA, which respectively represent the motor vehicle administrators and lenders in the title ecosystem across the entire country. In short, the title ecosystem benefits from the fastest rate and lowest cost possible when states adopt new cloud-based systems of record.

Conclusion: It is important to understand that these myths are just that: myths. It is time to embrace the potential of digital transformation in vehicle titling and registration in order to create a more efficient, cost-effective, secure, and interconnected system that benefits all stakeholders.

People are inclined to believe that change is impossible as it has been nearly two decades since the vehicle and titling industry has seen any. In reality, this means the industry is actually quite vulnerable to change and probably in need of it. When American businessman and politician George Romney was asked how American automakers allowed their globally dominant position in the market to be eroded by foreign car companies, he replied, “There is nothing more vulnerable than entrenched success.”

That’s exactly what we\'re seeing with titling and why it’s so vital for states to understand what CHAMP has brought to market. By launching a system in months and not years, we are enabling a much more efficient and fully digital path to titling and registration—not just for fleets, car dealers, insurance carriers and lenders, but also for the service providers who are now under the stress of transactions that require immediacy. That immediacy can only be met by a robust system that is fully digital and can be quickly operational.

Now that we have debunked these myths, let us drive forward with accurate information and embrace the opportunities that are ahead.

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