More car loans expected following scrappage scheme

Apr 29 2009 There could be a surge in the number of people taking out loans to purchase cars following the government's plans to introduce a scrappage scheme, it has been suggested.

Figures from Sainsbury's Bank have suggested more people could now be tempted to enter into the car market, which has suffered from people being unwilling to part with their vehicle during the recession.

"Our latest index indicates that 14.7 per cent of the money that people intend to spend on a vehicle over the next six months will be financed through personal loans, but this scheme gives car buyers another option to help them afford a new car, and we hope it pays off for the motor industry," said Steven Baillie, head of loans at Sainsbury's Finance.

He added: "The car scrapping scheme announced by the chancellor is a positive step to helping the motor industry, but our latest car buying figures show that there is a big job to do to resurrect its fortunes."

Chancellor Alistair Darling announced in his Budget last week plans to provide a £2,000 incentive to people to scrap their old cars in favour of newer, greener models.

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