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