Finance & Leasing Association17 February 2023
New figures released today by the Finance & Leasing Association (FLA) show that consumer finance new business fell by 4% in December 2022 compared with the same month in 2021. In 2022 as a whole, new business was 13% higher than in 2021.
The credit card and personal loan sectors together reported a fall in new business of 5% in December compared with the same month in 2021, while the retail store and online credit sector reported new business growth of 4% over the same period.
Commenting on the figures, Geraldine Kilkelly, Director of Research and Chief Economist at the FLA, said:
“The consumer finance market showed signs of weaker demand in the final quarter of 2022 as real household incomes came under further pressure from higher inflation and interest rates. Despite this, the continued recovery of FLA markets from the pandemic during most of last year meant that new business in 2022 as a whole reached a record level of £114.6 billion.
“While the near-term outlook remains challenging, the UK avoided recession in Q4 2022, inflationary pressures have shown signs of easing, and the labour market remains robust. The FLA’s Q1 2023 Industry Outlook Survey suggested that consumer finance providers are more optimistic about the prospects for growth, with 69% expecting some increase in new business over the next year, up from 9% in Q4 2022.
“As always, customers who are worried about meeting payments should speak to their lender as soon as possible to find a solution.”
Table 1: New consumer credit lending
|
|
Dec 2022 |
% change on prev. year |
3 months to Dec 2022 |
% change on prev. year |
12 months to Dec 2022 |
% change on prev. year |
| Total FLA consumer finance (£m) |
8,404 |
-4 |
27,121 |
-1 |
114,567 |
13 |
| Data extracts: |
|
|
|
|
|
|
| Retail store and online credit (£m) |
1,049 |
4 |
3,110 |
6 |
9,844 |
7 |
| Credit cards & personal loans (£m) |
4,575 |
-5 |
13,943 |
-3 |
58,191 |
17 |
| Second charge mortgages (£m) |
99 |
0 |
372 |
15 |
1,557 |
40 |
| Car finance (£m) |
2,429 |
-6 |
8,783 |
0 |
40,741 |
9 |
Note to editors:
- FLA members in the consumer finance sector include banks, credit card providers, store card providers, second-charge mortgage lenders, motor finance providers, personal loan and instalment credit providers.
- In 2022, FLA members provided £148 billion of new finance to UK businesses and households. £115 billion of this was in the form of consumer credit representing over a third of total new consumer credit written in the UK in 2022.
- Consumer car finance reported in these figures refers to finance obtained through the point of sale.
- For media enquiries, please contact the FLA press office on 020 7420 9656.
