Marginal growth for consumer finance market

The consumer finance market grew again in August compared to the same month in 2019, rising one per cent in volume and eight per cent in value.

This is according to figures released by the Finance and Leasing Association (FLA). It has also reported that in the eight months to August 2020, new business volumes in this market fell by 26% compared with the same period in 2019.

The consumer used car finance market reported growth in new business of two per cent by volume and 10% by value in August 2020 compared with the same month in 2019. In the eight months to August 2020, new business volumes in this market fell by 22% compared with the same period in 2019.

Meanwhile, the consumer new car finance market reported new business volumes one per cent lower in August than in the same month in 2019, while the value of new business grew by give per cent over the same period.  In the eight months to August 2020, new business volumes in this market fell by 33% compared with the same period a year earlier.

Geraldine Kilkelly, head of research and chief economist at the FLA, said: “It is encouraging to see further growth in the consumer car finance market, which shows the underlying strength of the market despite the disruption caused by the Covid-19 crisis.

“However, the near-term outlook for demand and employment is highly uncertain as new restrictions are imposed to deal with the ongoing crisis. It is more vital than ever that the Government and Bank of England support all lenders, including non-banks, by removing obstacles that still exist around access to funding.  This will ensure that the motor finance industry is able to meet the ongoing demand for forbearance and new credit.”