Dealers financed nearly 350,000 used cars, with advances totalling nearly £3.9 billion over the same period.

The percentage of private new car sales financed by FLA members through the POS was 86.5% in the year to the end of March, unchanged compared with the same period to the end of February.

Geraldine Kilkelly, head of research and chief economist at the FLA, said: “The first quarter of 2017 saw consumer car finance new business volumes increase in line with the industry’s expectations of single-digit growth for the year overall.”

The growth comes as new services aim to expand the audience for car finance by integrating it more closely with the car buying process.

For example, Auto Trader, the UK’s marketplace for new and used cars, has enhanced its trade adverts with the introduction of a finance calculator.

The service, which is free to existing customers until early 2018, gives dealers the option to show a monthly price and finance calculator in their adverts, powered by their own choice of lenders and interest rates.

The new service has been developed to help dealers better compete with specialist finance providers, banks and price comparison sites.

Auto Trader says it also gives dealers the opportunity to embed discussions on finance earlier in the car buying process.

Potential car buyers can choose their ideal deposit, term (in months) and mileage to establish their preferred finance package and then send their finance enquiry directly to the dealer.

The new features were developed in partnership with motor finance technology provider Codeweavers.

Paul Harrison, head of motor finance at Auto Trader said: “Finance has become one of our industry’s biggest performance drivers. However, all too many dealers are missing out on the opportunity to promote their available offers early in the buying process when consumers are making their key decisions.

“That’s why we created this new functionality as a priority, which we feel gives our customers a competitive advantage. Importantly, it also creates greater transparency for car buyers, helping them to understand the different product options online to help them make a more informed decision in the showroom.”

Harrison said it was the first step in creating a complete finance solutions service.

He added: “In the summer, we’ll also be introducing the ability for consumers to search by monthly price, which will put finance at the heart of car buying on Auto Trader and help give transparency to millions of car buyers.”

To add the finance calculator to adverts, dealers confirm their Financial Conduct Authority (FCA) firm reference number, and then select their preferred finance providers and representative APR.

Other platforms are also moving to streamline finance applications.

iVendi recently announced it was adding a plug-in ‘widget’ for its dealer customers that would add key motor finance elements to their website including a finance calculator, a comparator view of different finance products and a finance qualification pre-checker.

DealTrak has also announced it will offer the ability to personalise a finance quote, pre-check whether the finance offers are likely to be available, and apply for finance directly through its platform.

Growing demand for car finance is at the centre of an ongoing row about whether current levels of car-based consumer debt are sustainable.

The FCA has announced that it is conducting a study of the car lending market to establish whether firms should perform tougher checks on drivers before letting them sign up for deals.

In response to newspaper reports about the stability of the car finance market, Asset Finance International has reviewed recent claims to establish the facts.

The article can be found here.

Cars bought on finance by consumers through dealerships