Consumer finance new business fell by 26% in February

New figures released by the Finance & Leasing Association (FLA) show that consumer finance new business fell in February 2021 by 26% compared with the same month in 2020.

The retail store and online credit sector reported a fall in new business of 6% in February compared with the same month in 2020.  The credit card and personal loan sectors together reported a fall in new business of 30% over the same period.

Commenting on the figures, Geraldine Kilkelly, Director of Research and Chief Economist at the FLA, said “The lockdown restrictions over the winter months contributed to a fall in consumer finance new business overall of more than a quarter, with the credit card and personal loans sectors some of the hardest hit.”

“As the economy begins to re-open and consumer confidence improves, we expect to see a strong rebound in many of the consumer finance sectors. Annual new consumer credit overall in the UK is expected to return to its pre-pandemic level in 2022.”

New consumer credit lending

	Feb 2021	% change on prev. year	3 months to Feb 2021	% change on prev. year	12 months to Feb 2021	% change on prev. year
Total FLA consumer finance (£m)	5,654	-26	18,605	-26	80,760	-24
Data extracts:
Retail store and online credit (£m)	579	-6	2,187	-4	8,416	-6
Credit cards & personal loans (£m)	2,867	-30	9,399	-31	37,997	-28
Second charge mortgages (£m)	67	-37	185	-39	640	-50
Car finance (£m)	1,902	-24	6,123	-23	30,097	-21