New figures released today by the Finance & Leasing Association (FLA) show that consumer finance new business fell in May 2020 by 56% compared with the same month in 2019, and decreased by 27% in the five months to May 2020.
Credit card and personal loan new business together fell in May 2020 by 46% compared with the same month in 2019, while retail store and online credit new business was 25% lower over the same period.
Commenting on the figures, Geraldine Kilkelly, Head of Research and Chief Economist at the FLA, said: “The latest FLA figures continued to show that some sectors have been more severely hit by the lockdown restrictions than others. The strength of online sales in recent months meant that the retail store and online credit sector has recorded the smallest rates of contraction in new business since March.
“This week the industry has been asked to extend the period of forbearance to households. To provide this and meet a strong pick-up in demand for new credit, the Government and Bank of England need to extend financial support schemes to all lenders, including non-banks. This will also help to ensure that a competitive and vibrant consumer finance market remains post-crisis.”