The ‘adverse affluent’ who are refused credit

Motor finance specialist The Funding Corporation says its findings came after analysing more than five million pieces of customer data with credit ratings agency Experian.

The new category has been dubbed the “adverse affluent” because, despite a comfortable lifestyle, their adverse credit record can result in an automatic decline from mainstream lenders. Such customers, says the company, often have only marginally impaired credit files – but are being regarded as being no different from serial defaulters by bigger institutions.

The new sector is typified by people owning their own home, able to afford high-end consumer goods, reading broadsheet newspapers, taking regular holidays, and in secure employment.

The Funding Corporation’s Richard Cox said: “Until quite recently, credit blemishes such as a missed instalment to a wine club or a late credit card payment might have been nodded through by a bank. Now they can add up to an automatic rejection without any consideration given to a person’s ability to afford the loan repayments.”