Almost one in 20 motor finance customers have been identified as “vulnerable” by iVendi.
It looked at a sample of more than half a million sessions of consumers using its motor finance tools and found 4.3% were potentially classified as vulnerable.
Of these, almost one in five (17%) were successfully signposted to third party and lender links such as support lines.
If the sample is limited to online applications only, the incidence of vulnerable customers is even higher at 5.25%, compared to 2.88% in the showroom.
James Tew, CEO at iVendi, said: “The new statistics we have compiled show that there is quite a high incidence of vulnerable customers applying for motor finance. In fact, given that our client base skews towards prime lenders, the actual number across the entire market is almost certainly higher.
“Dealers have very specific responsibilities when it comes to these customers that are spelt out under Consumer Duty, and the announcement of the new FCA review means that they should be making sure that they are meeting those requirements.”
The FCA said in March that it would start reviewing firms’ treatment of vulnerable customers as part of its Business Plan for 2024-25. Ultimately, it wants to achieve better outcomes for consumers and markets.
Tew said: “This is an area we have been watching very closely. There are detailed and thorough provisions for vulnerable customers built into the Consumer Duty Module that we launched last year and which is now in use by thousands of dealers.
“It’s all about not just ensuring that people who apply for motor finance are handled in line with the regulations but being able to produce auditable data to show that this has happened. Dealers and finance providers need to not just do right but be able to prove that they behaved correctly and steered consumers towards the best outcomes.”
