Government needs to act now to support non-bank lenders as forbearance requests reach over 1.6 Million

The Finance & Leasing Association continues to call for the Government and the Bank of England to take immediate action to support the non-bank lending market, as new FLA figures released today show that the number of Covid-19 related requests for forbearance reached 1,623,000 in the twelve weeks to 29 May 2020. Of that total, 88% had been granted by the end of that period.

Stephen Haddrill, Director General at the FLA, said:
“Figures released today of a record fall in the UK economy in April of more than 20% highlights the urgent need for the Government and Bank of England to enable all lenders – bank and non-bank – to access the funding required to meet the huge demand for forbearance and new credit as the economy reopens.

“FLA members have a track record of supporting businesses and households during difficult times, with our latest figures for April showing new lending of more than £4.7 billion despite the lockdown. We have put forward a Term Funding Pipeline proposal which we believe will open up the current financial support schemes to a wider group of lenders – there should be no further delay, action is needed now.”

In the twelve weeks to 29 May 2020, FLA members received an estimated 1,623,000 requests¹ for Covid-19 related forbearance from customers. 1,424,000 (88%) of these requests had been granted by that date.

Over the same period, FLA asset finance division members received an estimated 287,000 requests for forbearance and had so far granted 83%. FLA motor finance division members received an estimated 613,000 requests and had so far granted 90%. FLA consumer finance division members had received an estimated 723,000 requests for forbearance and had so far granted 88%.

Note ¹: A single request for forbearance may cover multiple agreements held with that lender.

*Article Source http://www.financingyourcar.org.uk