New business conducted in the consumer finance sector fell by 6% in November compared to the same month in 2021, according to the latest figures published by the Finance & Leasing Association (FLA).
In the 11 months of 2022 up to November, however, the FLA data revealed that new business was 15% higher than in the same period the year before.
FLA members in the consumer finance sector include banks, credit card providers, store card providers, second charge mortgage lenders, personal loan and instalment credit providers, as well as motor finance providers.
The latest figures have show that the credit card and personal loan sectors together reported a fall in new business of 9% in November, compared with the same month in 2021. The retail store and online credit sector reported new business growth of 3% over the same period.
In total, the value of new business in the consumer finance space reported by the FLA hit £9.28bn for November.
“November saw the consumer finance market represented by FLA members report a fall in new business for the first time since February 2021,” director of research and chief economist at the FLA, Geraldine Kilkelly. “The performance across finance products was mixed, reporting either slower new business growth or lower levels of new business compared with November 2021.
“Nevertheless, consumer finance new business provided by FLA members is on track to be 10% higher in 2022 than its pre-pandemic level in 2019, and the value of consumer finance outstanding agreements at the end of 2022 is expected to be 1% higher than at the end of 2019.”
The FLA’s figures for the second charge mortgage market showed that news business hit £130m in November, representing a 14% rise on the same month in 2021.
Commenting on the second charge mortgage market data, FLA director of consumer and mortgage finance and inclusion, Fiona Hoyle, added: “The second charge mortgage market reported further growth in new business in November but at a slower rate than we have seen for much of 2022 when the market was recovering from the pandemic.
“The distribution by purpose of loan in November showed 59% of new agreements were for the consolidation of existing loans, 13% for home improvements, and a further 23% for both loan consolidation and home improvements.”
“As always, customers who are concerned about meeting payments should speak to their lender as soon as possible to find a solution.”
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