The markets served by the members of the Finance and Leasing Association are vital to the UK economy and 2017 proved to be another entertaining year as we steered through increased uncertainties.
Our FLA members continued to grow their market presence in 2017, with total new lending up by 6% to reach £128 billion. Whilst impressive, and the seventh consecutive year of growth, success cannot be judged by numbers alone.
For that, we have to go back to our role in serving the UK through its businesses and its people.
The FLA covers a broad remit. Our asset finance members support virtually every sector of the economy, both public and private and supporting domestic and export led growth. Their expertise has a vital purpose – to help the UK grow.
FLA members also support customers and households as they buy and borrow. In a consumer-led UK economy, our members ensure that lending needs can be met across a wide spectrum of society.
And of course we provide the financial lifeblood for the UK auto sector; in a very literal sense, we keep the UK moving.
With the help of clearer thinking on fuel technology, we will keep doing this with an ever-reducing emissions footprint. Allowing diesel to be demonised is not helping consumers or businesses.
We recognise the responsibility we collectively hold to ensure our firms and markets continue to serve their customers well.
Regardless of what Brexit brings, our industry’s raisons d’etre will not change:
- Help the UK grow.
- Help the UK to buy and borrow.
- Keep the UK moving.
The FLA is a powerhouse of technical expertise that supports members in meeting their challenges.
Our members contribute their knowledge and experience and that enabled the FLA to respond effectively to more than 40 major regulatory consultations last year, including challenging an FCA suggestion that household income wouldn’t be considered in affordability, which would have increased financial exclusion.
Our ability to make informed interventions strengthens our relationship with regulators, who respect credible challenges driven through real market insight.
Industry-led solutions can be implemented more quickly, and deliver the right outcomes more efficiently than other kinds of regulatory action.
Informational remedies agreed with the FCA as part of their Credit Card Market Study are now included in the FLA’s Lending Code.
We also responded to the FCA’s consultation on its mission statement, including the point that a new approach was needed in the supervision of the thousands of consumer credit firms for which the FCA is now responsible.
The FLA is here to make sure that our stakeholders know exactly where we fit in the economic landscape – and exactly how we can help deliver prosperity.
Last year, we persuaded the Government to extend the Enterprise Finance Guarantee to cover asset finance, and we helped the British Business Bank put leasing and hire purchase on the same footing as other types of credit. That means our members can offer more lending services to SMEs.
The FLA’s second key role is helping our markets achieve ever-higher standards of conduct.
All our markets need professional and well-informed colleagues driving them forward.
In motor finance, we have developed our long-established Specialist Automotive Finance programme and I’m very pleased to tell you the FLA has obtained government approval for a new Motor Finance Specialist Apprenticeship Standard.
Similarly, the FLA’s new Asset Finance Diploma, is setting the standard for training in the asset finance sector.
We have helped thousands of colleagues in our sector achieve accreditation through these schemes.
All of this goes to evidence that the FLA is here to help our members and to ensure our markets operate in a sustainable way.
If we do this well we dramatically reduce the need for others to come and tell us we need to run our businesses differently. Fail to do that and we can expect more scrutiny and more intervention.
The FLA team works hard in support of our markets.
As chairman, I have had the opportunity to see the breadth and depth of their work and I can testify to their commitment to serving their members and associates.
So, I would like to thank the entire team for what they have achieved in 2017 and to offer our support to them in achieving what is yet to come.
• Richard Jones is chairman of the Finance and Leasing Association and managing director of Black Horse
• This article is based on a speech made by Richard Jones at the annual Finance and Leasing Association Dinner in February 2018.
