The report titled “Philippines Auto Finance Market Outlook to 2023 – By Banks and NBFCs including Captive Units (Auto Loan Portfolio and Motor Cycle Loan Portfolio), By New and Used Motor Vehicles, By Motor Vehicle Financed (Passenger and Commercial Vehicles), By Loan Time Period” provides a comprehensive analysis of Philippines’ auto finance market including market evolution, market overview, market genesis, market size and market segmentations. Extensive focus has been placed in quantifying the auto credit disbursed auto loans outstanding and number of vehicles financed. The report covers aspects such as market segmentation (by loan tenure, type of vehicles, new and used cars and type of institutions) and snapshot on general automotive space in Philippines. Comparative landscape of major banks including Metro Bank, BDO, Ps Bank, East West Bank, Philippine National Bank (PNB Saving Bank), Bank of the Philippine Islands, RCBC, May Bank Philippines Incorporated and others as well as the comparative landscape of major NBFCs including the Toyota Financial Services Philippines Corporation (TFSPH), MAFS, Unistar Credit and Finance Corporation, Radio Wealth finance Company, Asia Link Finance Corporation and others have been extensively covered. The report also covers future industry analysis (by credit disbursed and auto loan outstanding), future market segmentation, SWOT analysis, growth opportunities, up-coming business models, government regulations and analyst recommendations.
Philippines Auto Finance Market Overview and Size
Philippines auto finance market has been identified in its growth stage. The auto finance market tends to align itself with the domestic market for automobiles. Given its relation with this huge market, the sector naturally plays an important role in the overall growth of the economy. During the last 5 years, the auto finance market has boomed as demand and supply for automotives was growing at double digits year on year. Lenders (supply side entities), in this period have evolved to provide a range of innovative products and services to further improve attraction and penetration of the market. There have been various factors driving the growth of the Philippines auto finance market by value as well as by credit disbursed. Some of these factors are the growing economy of Philippines, increasing motorization rate, increased disposable income leading to an increase in purchase of automobiles and the advent of web aggregators. Along with these factors, an increase in per capita income has led more households to own an automobile in Philippines.
Philippines Auto Finance Market Segmentation
By Type of Motor Vehicle Loans Provided By Banks and NBFCs (Auto Loan Portfolio and Motor Cycle Loan Portfolio): In Philippines, auto loan is disbursed only for passenger vehicles including passenger cars, utility vehicles, sports utility vehicles; and commercial vehicles including trucks, buses and trailers. Motorcycle loans provided to finance two wheelers in the country. Auto loan provided by both banks as well as NBFCs was observed to dominate the market during 2018. The total loan portfolio provided by the banks for financing automotives has grown over the review period.
By Type of Motor Vehicle (New Vehicle and Pre-Owned Vehicles): Loanfinancing provided for new vehicles established itself as market leader in the Philippines auto finance market during the year 2018 owing to the advantages that come handy with the new vehicles that includes higher resale value and better financing schemes. Pre-owned vehicles captured limited share in the market.
By Type of Motor Vehicle Financed (Passenger Vehicle and Commercial Vehicle): Passenger vehicles are used for domestic purpose either by family or an individual for personal use whereas commercial vehicles are majorly used for business purpose. Passenger vehicle financing dominated the Philippines auto finance market during the year 2018. Heavy traffic coupled with rising prices of the car is letting Filipinos to shift from cars to motor cycles in Philippines.
By Time Period of Loan (1, 2, 3, 4, 5 and more years) Between New and Pre-Owned Motor Vehicles: The loan tenure selected by the customer depends on factors such as the price of the car, income level of the customer, flexible scheme options and other social factors such as family size and life style of the individual. The maximum tenure allotted for a car loan by both banks and private finance companies is seven years for new car. It has been observed that, people opting for five year loan tenure dominated the Philippines auto finance market in 2018 followed by 3 year, 4 year, 2 year and 1 year loan tenure period.
By Vehicles Registered Under Various Regions: Number of new vehicles sold in NCR was observed to be higher compared to all other Filipino regions. The heavily populated capital city along with emerging business opportunities in the city has given a boost to commute via cars / motor cycles.
Competition within the Philippines auto finance market was observed to be highly fragmented along with majority the motor vehicle loans being financed by Banks and the rest small portion is financed by Non Banks and Dealerships. Some of the leading banking institutions include Metro Bank, BDO, Ps Bank, East West Bank, the Philippine National Bank (PNB Saving Bank), Bank of the Philippine Islands, RCBC, May Bank Philippines Incorporated and others. However, stiff competition was observed in the case of NBFCs and dealerships operating in the Philippines including Toyota Financial Services Philippines Corporation, MAFS, Unistar Credit and Finance Corporation, Radio Wealth finance Company and others. Parameters on the basis of which companies compete in the market include price, digitalization, customer centricity, type of distribution network, service portfolio and others. Although there are approximately 100-150 entities involved in extending owing to low cost of financing and high trust factor associated with their organized and stable business structures.
Philippines Auto Finance Market Future Outlook and Projections
Over the forecast period, Philippines auto finance market is expected to be positive if there is continuous need for motor vehicle among population. Multiple fin-tech startups have also come up in the country’s financial sector which poses a threat to multi finance companies. These start ups have developed products to augment the digitalization of the banking sector. This includes digital payments, online lending and remote banking facilities which made customer lending process uncomplicated further facilitating the car finance market in the country. Non-banks and dealerships services are expected to outpace the growth in banking institutions because of their customized products and ease to approach. The turnaround time to finance is also relatively less compared to banking institutions. In addition to that, the Philippines auto finance market is likely to witness a boom in terms of number of auto loans sanctioned especially on the technological front. Moreover, a rise in commercial activities engaging automobiles such as rising use of vehicles in public transport, agricultural and industrial use, are expected be the potential prospects of growth in the next five years.
Key Segments Covered:-
By Type of Motor Vehicle Loans Provided By Banks and NBFCs
Auto Loan Portfolio
Motor Cycle Loan Portfolio
By Type of Motor Vehicle
By Type of Motor Vehicle Financed
Sports Utility Vehicles
By Time Period of Loan between New and Pre-Owned Motor Vehicles and
Five Years and More
By Vehicles Registered Under Various Regions
Key Target Audience:-
Existing Auto Finance Companies
Banks & Subsidiaries
Auto OEM Captive Finance Companies
Non Banking Financial Institutions
New Market Entrants
Automobile Financing Companies
Automobile Original Equipment Manufacturer
Time Period Captured in the Report:-
Historical Period: 2013-2018
Forecast Period: 2018-2023
Key Companies Covered:-
East West Bank
Philippine National Bank
Bank of the Philippine Islands
Maybank Philippines Incorporated
Non-Banks and Dealership Financing
Toyota Financial Services Philippines Corporation (TFSPH)
Unistar Credit and Finance Corporation
Radio Wealth finance Company
Key Topics Covered in the Report:-
Philippines Auto Finance Market Evolution
Philippines Auto Finance Market Overview and Genesis
Philippines Auto Finance Market Ecosystem, 2018
Philippines Auto Finance Market Value Chain Analysis
Philippines Auto Finance Market Size, 2013-2018
Philippines Auto Finance Market Segmentation, 2013-2018
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, 2013-2023
Comparative Landscape in the Philippines Auto Finance Market
Philippines Auto Finance Market Future Outlook and Projections, 2018-2023
Analyst Recommendations for the Philippines Auto Finance Market
For more information on the research report, refer to below link:-
Ankur Gupta, Head Marketing & Communications