Philippines Auto Loan Outstanding is Expected to Reach around PHP 1,026.6 Billion by 2024: Ken Research

Nissan has expanded its Nissan Finance program to enable more customers in the Philippines to own a Nissan vehicle. In partnership with East West Banking Corporation (EastWest), the sales finance program provides wholesale and retail financing options and loan facility products exclusively for Nissan customers in the Philippines. Entry of Japanese Automakers in the Philippines Automotive Industry is set to act as a catalyst for the growth of sales in the Industry. Public sector external debt increased in the third Quarter of 2019 to USD 42.3 billion from USD 40.2 billion in the Second quarter. About USD 35.2 billion (83.3 percent) of public sector obligations were House Hold borrowings while the remaining USD 7.0 billion pertained to other government agencies’ loans, according to central bank data Strong Relations and Various Mergers and Acquisition further strengthen the Banks and NBFC’s in the Philippines Auto Finance Industry, while simultaneously creating entry opportunities for Captive finance players. Growth Opportunity in Philippines EV market: The Electric Vehicle Association of the Philippines (EVAP) aspires for the establishment of a national development program for electric vehicles that is anchored on the existing Motor Vehicle Development Program for the automotive industry. This is to be implemented in four (4) phases of within a ten-year-period. The first phase (2013) is the launch of the program, including technology upgrading needed by the industry; the second phase (2014 to 2015) involves the buildup of the local market and enhancement of its production capacity; the third phase (2016 to 2018) will be for local and export market expansion, together with horizontal and vertical integration with the local automotive industry; and the fourth phase (2019 to 2023) will be the full integration, regional and global, developmental evolution in technological advancement and market size up. Changing Nature of Ownership: Consumers in Philippines are increasingly moving forward to accommodate newer models of mobility and prefer partial ownership of vehicles instead of full ownership. Hence this will help in promotion of leasing activities. Rationale for Changes in Auto Loan Outstanding for Non-Bank Institutions: The share of multi finance companies has been projected to incline over the coming years. Compared to banks, multi-finance companies generate better returns. Generally, major multi-finance player’s record higher returns on equity and returns on assets as the benefits of higher asset yields outweigh the negatives of higher cost of funds, operating costs, and credit costs. The higher asset yield is due to the ability to tap the under-banked and unbanked market, an advantage that banks lack. Another reason why non-bank institutions are predicted to incline is because of the customized and innovative credit products they provide. These products are more appealing to masses and banks cannot provide such products because of the size of operations and standardization involved with the size. The number of non-bank units has been predicted to incline due to which their share will increase over the coming five years. Analysts at Ken Research in their latest publication “Philippines Auto Finance Market Outlook to 2024- Growing Prominence of Captive Finance and Surge in Used Car Sales Supporting Disbursement for Auto Loans” believe that the market demand is likely to follow a growth trend in the near future due to a forthcoming increase in used cars sales and a shift towards newer models of mobility such as car sharing and leasing, which will in turn help the economy grow as well. The market is anticipated to register a positive CAGR of 9.0% in terms of credit disbursed and 8.1% in terms of total loan outstanding during the forecasted period 2019P-2024F. Key Segments Covered:- By Type of Vehicle Financed New Vehicles Used Vehicles Motorcycles By Banks and Non Banks Banks (Auto Loans and Motorcycle Loans) Non Banks (Auto Loans and Motorcycle Loans) By Type of Banking Institutions Commercial and Universal Banks Thrift Banks By Nature of Vehicles New Vehicles (Banks and Non Banks) Used Vehicles (Banks and Non Banks) By Type of Vehicle Sold Passenger Commercial Motorcycles By Tenure of Loans New Vehicle (1 year, 2 Years, 3 Years, 4 years, 5 Years or More) Used Vehicle (1 year, 2 Years, 3 Years or More) By Registration of Vehicles Key Target Audience Existing Auto Finance Companies Banks OEM Dealerships Captive Finance Companies Credit Unions Private Finance Companies New Market Entrants Government Organizations Investors Auto mobile Associations Auto mobile OEMs Time Period Captured in the Report: Historical Period: 2014-2019P Forecast Period: 2019P-2024F Key Companies Covered: Banks MetroBank BDO Bank PS Bank Eastwest Bank The Philippine National Bank Bank of the Philippine Islands The Rizal Commercial Banking Corporation Maybank Philippines China Bank United Coconut Planters Bank Security Bank Corporation Union Bank Robinsons Bank The Philippine Bank of Communications (PBCOM) Land Bank of Philippines Asia United Banking Corporation Bank of Commerce Development Bank of Philippines Union Bank UCPB Bank Sterling Bank of Philippines NBFCs Radiowealth finance company (RFC) Unistar Credit and Finance Corporation Asia Link Finance Corporation Leauge One Finance and leasing Corporation DBP Leasing Corporation First United Finance and Leasing Corporation BPI Capital Corporation Cebu International Finance Corporation Orix Metro Leasing and Finance Corporation Philippine Depository and Trust Corporation LBP leasing and Financing Corporation RCBC Leasing and Finance Corporation Captives Toyota Financial Services Philippines Limited Key Topics Covered in the Report Philippines Auto Finance Market Overview and Genesis Philippines Auto Finance Market Ecosystem, 2019P Value Chain Analysis of Philippines Auto Finance Market, 2019P Philippines Finance Market Value Chain Analysis Philippines Auto Finance Market Size, 2013-2019P Philippines Auto Finance Market Segmentation, 20113-2019P Major Trends and Development in Philippines Auto Finance Market Regulatory Framework in the Philippines Auto Finance Market Snapshot On Philippines Automotive Sales And Manufacturing Market, 2014-2019P Ways to Finance Automotives in Philippines(Bank Finance or Multi Financing Companies, Personal Finance, Lease Financing) Vendor Selection Process for Auto Finance Company in Philippines Competitive Landscape containing Company & Product Profiles in the Philippines Auto Finance Market Financial Penetration of various OEM Brands Philippines Finance Market Future Outlook and Projections, 2019P-2024 Analyst Recommendations for the Philippines Auto Finance Market For More Information On The Research Report, Refer To Below Link:- https://www.kenresearch.com/banking-financial-services-and-insurance/loans-and-advances/philippines-auto-finance-market-outlook/308534-93.html Related Reports:- https://www.kenresearch.com/banking-financial-services-and-insurance/loans-and-advances/thailand-auto-finance-market-outlook/299310-93.html https://www.kenresearch.com/banking-financial-services-and-insurance/loans-and-advances/qatar-auto-finance-market-outlook-to-2023/274062-93.html https://www.kenresearch.com/banking-financial-services-and-insurance/loans-and-advances/us-vehicle-finance-market-outlook/252780-93.html Contact Us: Ken Research Ankur Gupta, Head Marketing & Communications Ankur@kenresearch.com +91-9015378249