New and used car finance grew in May, up 3% and 6% respectivley year-on-year, according to the latest figures from the Finance & Leasing Association.
The figures show that in the year to May 2011, 56% of new car sales used motor finance – the highest share of the market since March 2009.
Although demand for new and used car finance in the first five months of the year has varied, the FLA said the increased market share shows that “motor finance is an affordable way to buy a car”.
Take-up of leasing and personal contract purchase agreements for new cars were up by 14% in the last 12 months compared to the previous 12. Hire purchase agreements fell by 20% over the same period.
Paul Harrison, FLA head of motor finance, said: “While economic uncertainty affects consumers when making big purchasing decisions, motor lenders have responded by offering value-for-money packages.
“More than half of all consumers choose to use finance from the dealer when they buy a new or used car.
“As competition in the credit markets increases we expect consumers to continue to benefit from offers matched to their individual needs and budgets.”