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Published by: Key Note Publications Ltd
Published: Aug. 1, 2007 - 133 Pages
Table of Contents
- Executive Summary
- 1. Market Definition
- REPORT COVERAGE
- Consumer Credit Services
- Commercial Credit Services
- MARKET SECTORS
- Lending to Individuals
- Loans Secured on Dwellings
- Consumer Credit
- Other Lending
- Loans to Other Financial Institutions
- Loans to Non-Financial Corporations
- Loans to Unincorporated Businesses and Non-Profitmaking Bodies
- MARKET TRENDS
- Amount of Outstanding Debt Continues to Increase Strongly
- Rising Interest Rates
- Individual Insolvencies
- House Repossessions Increased in 2005
- Minimum Repayments for Credit-Card Issuers
- Providers of Individual Voluntary Arrangements
- ECONOMIC TRENDS
- Population
- Table 1: UK Resident Population Estimates by Sex (000), Mid-Years 2002-2006
- Inflation
- Table 2: UK Rate of Inflation (%), 2002-2006
- Unemployment
- Table 3: Actual Number of Unemployed Persons in the UK (million), 2002-2006
- Gross Domestic Product
- Table 4: UK Gross Domestic Product at Current and Annual Chain-Linked Prices (£m), 2002-2006
- Household Disposable Income
- Table 5: UK Household Disposable Income Per Capita (£), 2002-2006
- MARKET POSITION
- The UK
- Table 6: Consumer Credit Gross Lending by Lender (£m), 2002-2006
- Figure 1: Consumer Credit Gross Lending (£m), 2002-2006
- Table 7: The Total Amounts of Lending Outstanding to Individuals and Businesses at Year End (%), 2002-2006
- Figure 2: The Total Amounts of Lending Outstanding to Individuals and Businesses at Year End (%), 2002-2006
- Overseas
- 2. Market Size
- THE TOTAL MARKET
- Table 8: The Total Amount of Lending Outstanding by Type of Borrower at Year End (£m), 2002-2006
- Figure 3: The Total Amount of Lending Outstanding by Type of Borrower at Year End (£m), 2002-2006
- Table 9: The Total Amount of Lending Outstanding by Type of Borrower at Year End (%), 2002-2006
- Figure 4: The Total Amount of Lending Outstanding by Type of Borrower at Year End (%), 2002-2006
- BY MARKET SECTOR
- Lending to Individuals
- Loans Secured on Dwellings
- Table 10: The Amount of Lending Outstanding to Individuals Secured on Dwellings at Year End (£m), 2002-2006
- Consumer Credit
- Table 11: The Amount of Consumer Credit Outstanding at Year End (£m), 2002-2006
- Other Lending
- Loans to Other Financial Institutions
- Table 12: The Amount of Lending Outstanding to Other Financial Institutions at Year End (£m), 2002-2006
- Loans to Non-Financial Corporations
- Table 13: The Amount of Lending Outstanding to Non-Financial Corporations at Year End (£m), 2002-2006
- Loans to Unincorporated Businesses and Non-Profitmaking Bodies
- Table 14: The Amount of Lending Outstanding to Unincorporated Businesses and Non-Profitmaking Bodies at Year End (£m), 2002-2006
- 3. Industry Background
- RECENT HISTORY
- NUMBER OF COMPANIES
- Table 15: The Number of UK VAT-Based Enterprises Engaged in the Financial Intermediation Sector, 2002-2006
- EMPLOYMENT
- Table 16: The Number of Employees Working in the Financial Intermediation Sector (000), 2002-2006
- REGIONAL VARIATIONS IN THE MARKETPLACE
- Table 17: UK Members of the Credit Services Association by Region (number and %), 2006
- Mortgage Possession Notices
- Table 18: The Number of Mortgage Possession Notices in County Courts in England and Wales by Region (number and %), First Quarter 2007
- Table 19: The Number of Mortgage Possession Notices in County Courts in England and Wales, 2002-2006
- Figure 5: The Number of Mortgage Possession Notices in County Courts in England and Wales, 2002-2006
- Individual Insolvencies
- Table 20: The Number of Individual Insolvencies in the UK by Type by Region, 2002-2006
- Company Liquidations
- Table 21: The Number of Company Liquidations in the UK, 2002-2006
- DISTRIBUTION
- HOW ROBUST IS THE MARKET?
- Table 22: Mortgage Arrears by the Percentage of Total Balance in Arrears by Length of Arrears in the UK, 2002-2006
- Table 23: Company Liquidations as a Percentage of the Number of Companies Registered† in Great Britain, Fourth Quarter 2002-2006
- Table 24: The Number of Landlord Possession Actions in County Courts in England and Wales, 2002-2006
- Table 25: The Number of UK VAT-Based Enterprises Engaged in the Financial Intermediation Sector by Age of Business (number and %), 2006
- LEGISLATION
- The Consumer Credit Acts 1974 and 2006
- Home Credit
- Insolvency Laws
- The Enterprise Act
- KEY TRADE ASSOCIATIONS
- APACS
- Finance & Leasing Association
- Consumer Credit Trade Association
- Credit Services Association
- Federation of European National Collection Associations
- Asset Based Finance Association
- International Capital Market Association
- Council of Mortgage Lenders
- Other Organisations
- 4. Competitor Analysis
- THE MARKETPLACE
- MARKET LEADERS
- Cattles PLC
- Company Structure
- Current and Future Developments
- Financial Results
- Intrum Justitia Ltd
- Company Structure
- Current and Future Developments
- Financial Results
- iQor Ltd
- Company Structure
- Current and Future Developments
- Financial Results
- London Scottish Bank PLC
- Company Structure
- Current and Future Developments
- Financial Results
- Park Direct Credit Ltd
- Company Structure
- Current and Future Developments
- Financial Results
- Provident Financial PLC
- Company Structure
- Current and Future Developments
- Financial Results
- S&U PLC
- Company Structure
- Current and Future Developments
- Financial Results
- Other Companies
- Allied International Credit (UK) Ltd
- BCW Group PLC
- Cash Flow Services Ltd
- Controlaccount PLC
- Debt Free Direct Group PLC
- Inter-Credit International Ltd
- JB Debt Recovery Ltd
- Moreton Smith International Ltd
- Philips Collection Services Ltd
- OUTSIDE SUPPLIERS
- Drakes Group Ltd
- Equifax PLC
- Experian Group PLC
- Euler Hermes UK PLC
- ICC Information Ltd
- Kenyon Investigation Services Ltd
- Regal Credit Consultants Ltd
- MARKETING ACTIVITY
- Main Media Advertising Expenditure
- Table 26: Main Media Advertising Expenditure on Debt Management Services (£000), Year Ending March 2007
- Exhibitions
- 5. Strengths, Weaknesses, Opportunities and Threats
- STRENGTHS
- WEAKNESSES
- OPPORTUNITIES
- THREATS
- 6. Buying Behaviour
- MOST POPULAR SOURCES OF CREDIT
- Table 27: Most Popular Sources of Credit† Used in the Last 12 Months by Type (% of adults), 2006
- OWNERSHIP OF CREDIT AND DEBIT CARDS
- Table 28: Ownership of Credit and Debit Cards by Number of Cards (% of adults), 2007
- HOME-COLLECTED CREDIT
- Table 29: Use of Home-Collected Credit† in Last 12 Months by Type of Payment (% of adults), 2006
- OWNERSHIP OF A MORTGAGE
- Table 30: Ownership of a Mortgage on a House or Flat (% of adults), 2006
- ATTITUDES TOWARDS CREDIT AND DEBIT
- Table 31: Consumer Attitudes Towards Consumer Credit and Debt — Summary of Results (% of respondents), 2007
- Table 32: Consumer Attitudes Towards Consumer Credit and Debt — Analysis of Selected Statements (% of respondents), 2007
- 7. Current Issues
- INTERNATIONAL ISSUES
- A Warning by the Bank for International Settlements
- US Sub-Prime Mortgage Lending Market Under Stress
- THE POLITICAL SCENE
- Competition Commission Opens Up Home-Credit Market to Competition
- Office of Fair Trading Examination into Credit-Card Interest Calculation Methods
- The Financial Ombudsman Service (Alternative Dispute Resolution Process)
- INDUSTRY ACTIONS
- Industry Standards for the IVA Sector
- Concerns About IVA Advertisements
- IVA Debt Escape Route Made Easier
- CONSUMER TRENDS
- Increase in the Number of County Court Judgements
- CORPORATE ACTIVITY
- Cattles PLC
- Debt Advisor Group PLC
- Debt Free Direct Group PLC
- Park Direct Credit Ltd
- Provident Financial PLC
- LEGISLATIVE CHANGES
- The Consumer Credit Act 2006
- 8. The Global Market
- GLOBAL COMPARISONS
- Household Indebtedness
- Table 33: Household Indebtedness Among Seven of the Leading Industrialised Countries (% of nominal disposable income), 2002-2006
- EUROPE
- Table 34: Value of Mortgage Debt and Per Capita Mortgage Debt by Country (_m and _), 2005
- Intrum Justitia's European Payment Index Survey
- Table 35: Intrum Justitia's European Payment Index Survey†, Spring 2004-Spring 2007
- THE US
- Table 36: US Consumer Credit Outstanding by Type of Credit ($bn), 2002-2006
- Table 37: US Consumer Credit Outstanding ($bn), 2002-2006
- Table 38: The Total Number of Bankruptcy Filings in the US by Type, Year Ending 31st December 2002-2006
- 9. Forecasts
- INTRODUCTION
- The Economy
- Population
- Table 39: Forecast UK Resident Population by Sex (000), Mid-Years 2007-2011
- Inflation
- Table 40: Forecast UK Rate of Inflation (%), 2007-2011
- Unemployment
- Table 41: Forecast Actual Number of Unemployed Persons in the UK (million), 2007-2011
- Gross Domestic Product
- Table 42: Forecast UK Growth in Gross Domestic Product in Real Terms (%), 2007-2011
- FORECASTS 2007 TO 2011
- Table 43: The Forecast Total Amount of Lending Outstanding at Year End (£m), 2007-2011
- MARKET GROWTH
- Figure 6: Forecast Growth in the Total Amount of Lending Outstanding at Year End (£bn), 2002-2011
- FUTURE TRENDS
- High UK Household Sector Indebtedness
- Gross Mortgage Lending Reaches New High
- Rising Interest Rates
- 10. Company Profiles
- Cattles Plc
- Intrum Justitia Ltd
- London Scottish Bank PLC
- Provident Financial Plc
- 11. Consumer Confidence
- METHODOLOGY
- KEY FINDINGS THIS QUARTER
- THE WILLINGNESS TO BORROW
- Confidence Improves
- Table A: The Average Amount Consumers Are Willing to Borrow in Order to Purchase Expensive Items at Current and Constant November 2004 Prices (£ and £bn), February 2006-2007
- Willingness to Borrow Slips Slightly
- Table B: The Number of Adults Willing to Borrow in Order to Purchase Expensive Items (000 and %), February 2006-2007
- SPENDING FROM SAVINGS
- Slight Increase in Spending from Savings
- Table C: The Average Amount Consumers Are Willing to Spend from Savings in Order to Purchase Expensive Items at Current and Constant November 2004 Prices (£ and £bn), February 2006-2007
- Saving Grows in Relative Importance
- Table D: The Average Amounts Adults Are Confident Spending to Purchase Expensive Items (£ and %), February 2006-2007
- 12. Further Sources
- Associations
- General Sources
- Government Publications
- Other Sources
- Bisnode Sources
AbstractAs at the end of 2006, the total amount of lending outstanding (or debt) in the UK was £1,868.1bn, a rise of 12.9% on 2005 and 48.2% higher than the figure recorded in 2001. The amount of debt in the UK is currently a matter of considerable debate and concern.
This Key Note Market Report covers lending to both individuals, including consumer credit and loans secured on dwellings; and corporate bodies, including other financial corporations, non-financial corporations, unincorporated businesses and non-profitmaking organisations. In 2006, the largest sector was loans secured on dwellings, and the fastest-growing sectors between 2001 and 2006 were loans made to other financial corporations and loans to non-financial corporations.
The debt management and credit industry is faced with an ongoing array of legislation and regulatory changes. The most important of these included the introduction of the Consumer Credit Act 2006, which principally amends the Consumer Credit Act 1974.
The Competition Commission has also introduced measures aimed at increasing competition in the home-credit market, and the British Bankers' Association (BBA) and representatives of the Individual Voluntary Arrangement (IVA) industry have agreed to work together to create industry standards for that sector. The Financial Services Authority (FSA) has also commenced an investigation into the British sub-prime mortgage market and will assess, among other investigations, whether mortgage borrowers with poor credit histories are being treated fairly by lenders.
The IVA is one of the growth sectors of the debt management industry. Companies that provide IVAs for people who are unable to pay their debts receive fees from creditors for administering the scheme. However, the creditors involved, which include banks and other lenders, have decided to substantially reduce the fees they pay to the IVA providers. These reductions are expected to have a severe impact on the providers, and many have had to change their business plans considerably to accommodate the change.
The amount of lending outstanding to UK borrowers is forecast to continue to rise up to 2011, especially within the business sector. However, increases in UK interest rates could have a serious impact on the market and result in an increase in the number of borrowers defaulting on their loans. If this situation materialises, then demand for the services of debt management companies looks likely to remain strong.
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