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Auto finance market to power ahead
By Lu Nengneng |
December 24, 2012, Monday
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Print Edition
Print Edition
CHINA'S fledgling auto finance market will more than triple to 1 trillion yuan (US$160.4 billion) over the next decade on a rise in younger consumers, the 2012 China Auto Finance Report forecasts.
By the end of last year 300 billion yuan in auto loans were issued, the report, which was co-published by audit, tax and advisory firm Deloitte and China Minsheng Bank earlier last week, said. But the penetration rate of consumers taking the loans was only 10 percent, far trailing the 70 percent in more developed car markets like the US.
The low penetration rate was due to consumers in China not being used to taking out loans for car purchases, the report said, adding the financial industry has been slow to tap the potential as China's personal credit rating system is still not developed to help evaluate the risks of lending.
But the report pointed out the emergence of younger consumers who are more likely to spend money.
By the end of last year 300 billion yuan in auto loans were issued, the report, which was co-published by audit, tax and advisory firm Deloitte and China Minsheng Bank earlier last week, said. But the penetration rate of consumers taking the loans was only 10 percent, far trailing the 70 percent in more developed car markets like the US.
The low penetration rate was due to consumers in China not being used to taking out loans for car purchases, the report said, adding the financial industry has been slow to tap the potential as China's personal credit rating system is still not developed to help evaluate the risks of lending.
But the report pointed out the emergence of younger consumers who are more likely to spend money.
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