New figures released today by the Finance & Leasing Association (FLA) show that consumer finance new business fell in October 2020 by 11% compared with the same month in 2019, and decreased by 18% in the ten months to October 2020.
Consumer car finance new business by value and retail store and online credit each grew in October by 2% compared with the same month in 2019. Credit card and personal loan new business together fell by 20% in October 2020 compared with the same month in 2019.
Commenting on the figures, Geraldine Kilkelly, Head of Research and Chief Economist at the FLA, said: “Consumer confidence weakened as new restrictions were introduced in October to deal with the rise in coronavirus cases. This is reflected in weaker demand for consumer finance across most of the main products.
“The economic outlook has improved following the promised rollout of a vaccine before Christmas. Our latest research suggests that consumer credit in the UK is expected to grow by 9% in 2021, following a contraction of 22% in 2020 as a whole. New lending on credit cards is expected to grow by only 5% next year, with households more cautious about building up debt post-crisis.”