Barclays Partner Finance has revealed plans to withdraw from the motor finance market, following an internal strategic review.
The company has issued termination notices to dealer partners within the industry explaining its decision. According to Barclays, the decision was commercial and came following an internal review which resulted in a strategic shift within the business.
In a statement, Barclays Partner Finance said: “Barclays Partner Finance is currently number one in UK retail point of sale and has a vision to continue to lead this market through continued investment in new capabilities and innovation to grow.
“After a strategic review of its Motor Portfolio, Barclays Partner Finance has made a commercial decision to reduce its focus on Motor Point of Sale Finance.
“Given this outcome, the business will no longer invest in the Motor Portfolio as a growth area and will shortly cease to originate new business in this segment. We will continue to support colleagues as we work through this transition.”
Barclays Partner Finance offered personal contract purchase (PCP) and conditional sale motor loans as part of its motor finance business, with loan value ranging from £1,500 to £50,000.
The decision comes at a difficult time for the motor finance industry – with registrations for new cars consistently falling this year and the results of the FCA review into the industry to be announced in the coming months.
Potential changes outlined in the FCA report may involve new consumer credit rules to strengthen existing provisions, or perhaps a bolder strategy of intervention such as banning DiC and similar commission models – which came under heavy scrutiny in the report.