Consumer finance up 6% in October

New figures released today by the Finance & Leasing Association (FLA) show growth of 6% in consumer finance new business in October, compared with the same month last year.

Credit card and personal loan new business together grew by 7% compared with October 2015, while retail store and online credit new business fell by 4%. Second charge mortgage new business decreased 15% by value and 22% by volume over the same period.

Commenting on the figures, Geraldine Kilkelly, Head of Research and Chief Economist at the FLA, said:

“October was a quiet month for the second charge mortgage market as it continues to adapt to life under the Financial Conduct Authority’s mortgage regime. In the ten months to October 2016, this market reported new business up 5% by value and down 6% by volume.

“The FLA’s latest commissioned research of consumer lending forecasts by Oxford Economics suggests that new consumer credit in the UK will continue to grow in 2017 by around 1%. This compares to a growth forecast of almost 6% in 2016 as a whole.”

Table 1: New consumer credit lending

Note to editors:

1. 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.

2. In 2015, FLA members provided £110 billion of new finance to UK businesses and households. £81 billion of this was in the form of consumer credit representing almost a third of total new consumer credit written in the UK in 2015.