New business conducted across the consumer finance grew by 13% in August compared to the same month last year, new figures published by the Finance & Leasing Association (FLA) have revealed.
In the eight months to August 2021, the FLA confirmed that the level of new business remained 15% higher than in the same period in 2020.
The retail store and online credit sector reported new business up by 9% in August compared with the same month in 2020, and growth of 11% in the first eight months of 2021.
The credit card and personal loan sectors together reported new business up by 29% in August compared with the same month last year, as well as growth of 10% in the first eight months of 2021.
FLA director of research and chief economist, Geraldine Kilkelly, commented: “Most consumer finance sectors reported growth in August as they continued to recover from the impact of the pandemic on new business levels last year. The retail store and online credit sector reported annual new business in August 1% higher than its pre-pandemic peak.
“The near-term economic outlook is likely to be weaker than previously expected as rising prices and some increase in the unemployment rate following the end of the furlough scheme weigh on consumer confidence.”
FLA members in the consumer finance sector include banks, credit card providers, store card providers, personal loan and instalment credit providers, motor finance providers, as well as second charge mortgage lenders.
Across the second charge mortgage sector, new business saw 118% growth in August compared to last year’s figure, to total £95m worth of new lending.
Commenting on the figures for the second charge mortgage market, FLA director of consumer and mortgage finance and inclusion, Fiona Hoyle, added: “The second charge mortgage market continued its recovery from the pandemic in August. The market has reported more normal levels of new business in recent months which we expect to continue in the final quarter of 2021.”
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