AI agents for business finance: what they can and can't do
What AI agents can do in bookkeeping, close, collections and compliance today, where a person must stay in charge, and how to judge a product.
The short answer
A Nigerian car dealer can fund stock in three ways: buy cars outright with its own money or a loan, take cars on consignment from owners and pay them when each car sells, or use floor-plan finance, where a lender funds the stock and is repaid car by car. Owned stock gives the best margin and the most risk; consignment needs little capital but earns a commission; floor plans sit between, at a cost the lender states and the dealer must accept before drawing.
A car yard ties up a great deal of money. For example, ten cars at ₦15 million each is ₦150 million standing still until each one sells, and in a slow month that money earns nothing. How a dealer funds that stock decides how fast it can grow and how badly a slow season hurts. Here are the three models and how to cost them.
Owned stock
The dealer buys the car and owns it outright. The full margin is the dealer's, and so is the risk: price falls, damage on the lot, and the cost of money tied up while the car waits for a buyer.
- Funded by: retained profit, partners' capital, or a bank loan or overdraft.
- Best for: fast-moving models where you know the resale price.
- Watch: days in stock. Every extra week costs money whether or not you borrowed it.
Consignment
An owner leaves a car with the dealer to sell. The owner keeps title until it is sold; the dealer earns a commission or keeps anything above an agreed minimum price. Little capital is needed, which is why many yards start this way. A consignment agreement should say, in writing:
- The minimum price the owner will accept and the dealer's commission.
- How long the car stays on the lot and how it is returned.
- Who insures it and who pays for repairs, cleaning and test drives.
- How and when the owner is paid after sale (for example within two working days of the buyer's funds clearing).
- That the dealer holds the papers and has verified them (see Customs papers and VIN checks).
Keep consignment money apart from your own. A buyer's payment for a consigned car belongs mostly to the owner; spending it on the yard's bills is how dealers fall into disputes.
Floor-plan finance
In a floor plan, a lender pays for the dealer's stock and the dealer repays the amount for each car when it sells, plus interest for the days it was held. Some Nigerian banks and finance companies offer stock or inventory finance under various names; availability, terms and security vary, so ask lenders directly. Common features to compare:
| Term | What to ask |
|---|---|
| Rate | Is it stated per day, per month or per year (APR)? Monthly and annual figures are not comparable until converted. |
| Fees | Arrangement, audit or inspection fees, and when they are charged |
| Curtailments | Must you repay part of a car's value if it is unsold after, say, 90 days? |
| Security | Does the lender hold the papers, take a security interest in the stock, or require a guarantee? |
| Audits | How often does the lender count your stock? |
| Default | What happens if a car is sold and not repaid at once? |
Lenders taking security over vehicles and inventory can do so under the Secured Transactions in Movable Assets Act 2017, which allows movable assets including vehicles and inventory as collateral, perfected by registration at the National Collateral Registry, with priority by time of registration, per an Aelex overview. The lender offers a limit; the dealer reads the agreement in full and accepts it before any car is funded.
Choosing the mix
- Use owned stock for your fastest sellers, where the margin justifies the money tied up.
- Use consignment to widen choice on the lot without capital, accepting a smaller cut.
- Use stock finance only where you know a car's likely days in stock; slow cars on a floor plan eat their own margin.
- Track days in stock for every car weekly and act on anything past your limit.
Whatever the mix, review it every quarter against real numbers: average days in stock, margin per car after finance cost, and how much of the lot is owned, consigned or financed. A dealer who knows these three figures can tell a lender, a partner or an owner exactly why a car is priced where it is.
Cash, compliance and records
Section 2 of the MLPPA 2022 bars cash payments above ₦5 million (individual) or ₦10 million (company) except through a financial institution, so car sales are paid by transfer. SCUML lists car dealers among designated businesses that must register. Keep each car's purchase, finance and sale records together for at least six years, as the Nigeria Tax Administration Act 2025 requires for business records.
Where Pryme fits
A Pryme Business Account can run separate accounts so consignment money is kept apart from the yard's own cash, and virtual accounts help match each buyer's payment to the right car. See also car dealer sales agreement template.
Questions people ask
What is floor plan financing for car dealers?
A lender pays for the dealer's stock and the dealer repays the amount for each car when it sells, plus interest for the days held. Terms, security and availability vary by lender in Nigeria.
Is consignment better than buying cars outright?
It needs far less capital but earns a commission instead of the full margin. Many dealers use both: owned stock for fast sellers and consignment for choice.
Can a lender take my car stock as security?
Yes. The Secured Transactions in Movable Assets Act 2017 allows vehicles and inventory as collateral, perfected by registration at the National Collateral Registry.
Can a customer pay cash for a car in Nigeria?
Not above ₦5 million for an individual or ₦10 million for a company, except through a financial institution, under section 2 of the MLPPA 2022.
Sources
- Afriwise (Aelex): overview of the Secured Transactions in Movable Assets Act 2017 (27 Apr 2023) · accessed Oct 2026
- TheCable: MLPPA 2022 section 2 cash payment limits (quoted in Falana report) · accessed Oct 2026
- SCUML Registration Guideline (EFCC, 2025) · accessed Oct 2026
- Nigeria Tax Administration Act 2025 (gazette copy) · accessed Oct 2026
This article is general information, not financial, legal or tax advice. Products described are provided under the terms on this site and are subject to regulation and eligibility.