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Consumer Finance Sees 9% Growth in April Amid Positive Economic Indicators

Overview of Sector Performance

The increase in Consumer finance was not uniform across all sectors. The credit card and personal loans sectors notably outperformed other categories, with an 11% increase in new business compared to April 2023. This suggests that consumers may be feeling more comfortable with taking on new debt, likely influenced by improving economic conditions and the potential for lower interest rates.

Conversely, the retail store and online credit sector did not fare as well, witnessing a 3% decline in new business over the same period. This decline could be attributed to shifting consumer spending habits and possibly the saturation of online retail financing options.

Economic Factors Influencing Growth

Geraldine Kilkelly, Director of Research and Chief Economist at the FLA, pointed out that the robust performance in April could partially be attributed to the shorter working month in April 2023 due to the timing of Easter. More importantly, Kilkelly highlighted the improvement in consumer confidence, bolstered by better news on inflation and the anticipation of lower interest rates.

“The General Election campaigns are underway, but for many households, the real game changer will be a potential reduction in interest rates in the latter half of 2024,” said Kilkelly. She also mentioned that the FLA’s latest research anticipated single-digit growth in the value of new business for the consumer credit market in 2024, estimating around a 4% increase compared to 2023.

Detailed Financial Data

April’s performance reflects broader trends in the consumer finance market:

  • Total Consumer Finance: Showed a 9% increase to £9,591 million.
  • Retail Store and Online Credit: Declined by 3%, totaling £660 million.
  • Credit Cards & Personal Loans: Increased by 11%, amounting to £5,182 million.
  • Second Charge Mortgages: Surged by 40%, reaching £138 million.
  • Car Finance: Grew by 7%, totaling £3,200 million.

These figures illustrate a diverse landscape where different segments of the consumer finance market are responding uniquely to the changing economic conditions.

Looking Ahead

As consumer finance continues to navigate through economic uncertainties, the sector remains a critical indicator of overall economic health and consumer sentiment. With the General Election and potential policy changes on the horizon, stakeholders in the consumer finance market will be closely monitoring the impact of these events on lending practices and consumer borrowing habits.

Retailers, lenders, and policymakers alike will need to remain agile, adapting to the evolving economic environment to support sustained growth in the consumer finance sector.

This post first appeared on Instant Payday Loans Online With No Credit Check (UK) - Bad Credit Friendly, please read the originial post: here

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Consumer Finance Sees 9% Growth in April Amid Positive Economic Indicators


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