One of North-East England’s fastest-growing fintech firms has confirmed they are to pursue further expansion over the course of 2017, regardless of expectations for an economic slowdown.
The call comes despite concerns for the future of the retail credit sector which Refused Car Finance - who broker loans for car purchases - depend.
Refused Car Finance brokers finance for consumers unable to obtain traditional car finance.
Typically, a bad or non-existent credit history is the reason for their failure to secure traditional financing models to purchase a vehicle.
They are therefore highly-dependent on strong relationships with specialist finance providers.
Managing Director of Refused Car Finance, Craig Rutherford, brings together those lenders prepared to lend to this higher-risk segment in the market.
In the last six months alone, the company has received over 5000 unique applications of which it was able to approve 98.4%, thanks to its panel of 15 lenders who have 61 tiers of finance to choose from.
However, the UK’s future relationship with Europe does present some concerns to Rutherford.
Rutherford tells PoundSterlingLive.com that he is concerned with the impact Brexit might have on the lenders he introduces clients to:
“Our business is dependent on outside lenders offering our customers loans, as such our major concern is where these funders are originating their capital. By far the most reliable source of capital funding is UK-based institutions, although this is far from guaranteed, it is certainly more reliable than lenders who source their funding from overseas.
“Should the UK economy become less stable, investors become less confident and move their funds into more secure foreign markets, this is clearly outside of most SME’s, so all we can do is offer as diverse a portfolio of products funded by a wide range of investors.”
Refused Car Finance can offer a loan for its customers, providing the applicant produces proof of affordability, are free from insolvency and/or has a supporting guarantor that fits the lenders eligibility criteria.
“We are striving to be the UK’s #1 bad credit car finance broker. Although no one can guarantee car finance, we come pretty close. We are confident that our business will continue to turn over a profit into 2017 and we will continue to expand our business with a new sister company, Zoomo Cars, launching early next year. Provided that our lenders are still receiving funding, we are able to continue increasing our business,” says Rutherford.
Planned Expansion to go Ahead in 2017
Started two years ago and local to Newcastle-upon-Tyne, Refused Car Finance is expanding, and has grown to a team of 11, with more than 15 lenders on board.
“We are launching a new brand with two locations opening in 2017 and we intend to push on with this regardless of the Brexit negotiations,” says Rutherford.
Once the company has launched their new car dealership Zoomo, they will be expanding throughout the country, starting with a new site in Middlesbrough.
This should be followed by a site in Teeside.
The desire to invest in the future is unsurprising when we consider the latest surveys from the SME sector where borrowing is expected to jump in 2017 and the Federation for Small Business reports confidence is rising back above pre-referendum levels.
Refused Car Finance is not considering relocating to Europe, nor would it consider a potential move in the near future.
“Our main focus is to continue expanding throughout the UK with new franchises and dealerships. Provided that our lenders continue to receive funding, we see no reason as to why we would need to relocate,” says Rutherford.
Further Expansion Plans Will be Made Once Uncertainty is Cleared
Beyond existing expansion plans, there are some questions markets thanks to Brexit.
With the recent press coverage on Prime Minister May’s ‘muddled’ thinking over a potential exit from the single market, Rutherford is disappointed by the lack of clarity on such an important issue:
“We’re a finance broker so we have established strong partnerships with many finance lenders to cater for a wide range of circumstances. Many financial regulations have derived from EU legislation, including those that are governed by the Financial Conduct Authority.
“In order for us to proceed with expansion in the UK we would need to know what sort of relationship the UK will strike up with the EU. Depending on the relationship the UK government establishes, there may be changes to legislation in the future which could affect our business.”