New business volumes in the consumer finance space for the first nine months of 2022 are up 19% on the same period last year, data published by the Finance & Leasing Association (FLA) has indicated.

Figures also showed that new business volumes were 4% higher in the month of September compared to 2021.

The first nine months of 2022 have seen new business up 19% on the same period in 2021.

FLA members in the consumer finance sector include banks, credit card providers, store card providers, second charge mortgage lenders, personal loan and instalment credit providers, as well as motor finance providers.

In September, the latest data showed that the credit card and personal loan sectors together reported new business up by 7% in September compared with the same month in 2021, while the retail store and online credit sector reported new business growth of 4% over the same period.

Commenting on the figures, director of research and chief economist at the FLA, Geraldine Kilkelly, said: “In September, the consumer finance market reported its third highest level of monthly new business so far this year, but the slowest rate of new business growth since September 2021. Growth in the value of new business reported by the credit card and personal loans sectors and consumer used car finance sector eased to single digits for the first time this year.

“Consumer confidence about the outlook for their personal financial situations has weakened as the impact of higher inflation and interest rates have squeezed real household incomes.  The FLA’s Q4 2022 Industry Outlook Survey showed that two thirds of consumer finance providers expected some decrease in new business over the next year, with only 8% anticipating an increase.

“As always, customers who are worried about meeting payments should speak to their lender as soon as possible to find a solution.”

The FLA’s figures for the second charge mortgage space revealed that September saw £145m worth of new business, a 42% increase on last year. This total was made up of 3,138 new agreements, which also reflected a 29% rise compared to the same month in 2021.

Commenting on these figures, FLA director of consumer and mortgage finance and inclusion, added: “The second charge mortgage market returned another strong performance in September with further double-digit growth in new business by both value and volume.

“The distribution by purpose of loan in September showed 57% of new agreements were for the consolidation of existing loans, 15% for home improvements, and a further 22% for both loan consolidation and home improvements.”

“As always, customers who are concerned about meeting payments should speak to their lender as soon as possible to find a solution.”

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