AM Online

BBC links PPI payments with new car registration growth

Average payment protection insurance (PPI) pay outs are totalling £450 million a month and a BBC Radio 4 report is linking it to the boost in new car registrations.

The Radio 4 programme investigates PPI pay outs and how they’re effecting economic growth in the UK.

The programme reports that although the banks have set aside over £20 billion for PPI pay outs, much of this will be lost in admin costs; meaning the overall effect on the economy is far less than the total amount originally suggests.

However, people that receive a large sum of money through a PPI pay out are more inclined to spend it. New car registrations for January are up by 7.6% to 154,562 units, according to the latest data from the Society of Motor Manufacturers and Traders (SMMT).

Perrys chairman Ken Savage joined the programme and said: “There isn’t one single thing that creates the demand for new and used cars. But people are getting PPI payments- an average of £3,000 up to £10,000. Giving an additional income to provide a deposit for a car.”

Listen to the full BBC Radio 4 programme, which starts at 23 minutes and 20 seconds.

Do you think PPI payouts are driving new car registration growth? Please add your opinion in the comments section below.

 



Click here for finance and insurance best practice and procurement insight

If you are not a registered user your comment will go to AM for approval before publishing. To avoid this requirement please register or login.

Comment as guest


Login  /  Register

Comments

  • Mike Doyle - 06/02/2014 14:26

    No, I think it's the availabilty of finance which is too cheap and puts off the inevitable balloon payment - live now pay later! for ever and ever....

    Reply as guest

    Login  /  Register