Agents market the financier's loan schemes to you and complete all the paperwork on behalf of the financier. It is the agent who negotiates the discounts provided by the car dealers. The amount of discount that the agent is able to negotiate from the dealer depends upon how many cars are sold from the dealership by the agent and the relative importance of the given agent's business to the dealership. The agent also receives a commission from the financier for bringing him his car finance customers. This commission is of two types. The first is a standard commission given to the agent by the financier on the loan amount disbursed to you. This could be around 3% of the loan amount disbursed. The second is a target-achievement incentive. Most agents give away the standard commission so that their rates can be cheaper than those of their competitors'. This is called the agent's re-subvention i.e. the agent giving back his standard commission to the financier in order to further reduce the borrowing rate for you.

Let's now take the example a little further –
Carrying our hypothetical example even further, if the base rate at which a financier is willing to do business is 16% per year, the borrowing rate is brought down further to 14.5% or 14% per year, the agent's re-subvention can further reduce your borrowing rate of interest to 13.5% or 13.75% per year!