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New figures released by the Finance & Leasing Association (FLA) show that consumer finance new business fell in June 2024 by 8% compared with the same month in 2023. In the first half of 2024, new business in this market held steady compared with the same period in 2023.
The credit card and personal loans sectors together reported new business 8% lower in June compared with the same month in 2023, while the retail store and online credit sector reported a fall in new business of 9% over the same period.
Commenting on the figures, Geraldine Kilkelly, Director of Research and Chief Economist at the FLA, said “The consumer finance market reported new business 1% lower in Q2 2024 as a whole as the impact of successive interest rate rises between 2021 and 2023 continued to weigh on demand.
“The Bank of England’s decision to cut Bank Rate in August and the return of inflation to the 2% target has improved the outlook for household spending power. Our latest research suggests that total UK new consumer credit by value is likely to grow in 2024 by 6% and by a further 5% in 2025.”
New consumer credit lending
|
Jun 2024 |
% change on prev. year |
3 months to Jun2024 |
% change on prev. year |
12 months to Jun2024 |
% change on prev. year |
|
| Total FLA consumer finance (£m) |
9,115 |
-8 |
28,461 |
-1 |
112,705 |
-1 |
| Data extracts: |
|
|
|
|
|
|
| Retail store and online credit (£m) |
660 |
-9 |
1,994 |
-6 |
8,460 |
-5 |
| Credit cards & personal loans (£m) |
4,687 |
-8 |
15,166 |
0 |
59,471 |
0 |
| Second charge mortgages (£m) |
145 |
7 |
425 |
20 |
1,500 |
0 |
| Car finance (£m) |
3,215 |
-10 |
9,636 |
-3 |
38,407 |
-3 |
Latest Bank of England data shows that the annual growth rate for consumer credit, including credit cards, personal loans and overdrafts, dipped to 8% in June from 8.4% in May. The annual growth rate for credit card borrowing fell to 10.5%, from 10.8% in May. Net consumer credit borrowing dipped slightly in June to £1.2…
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