Provident to enter car finance market

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Credit lender Provident Financial is to buy car finance firm Moneybarn for £120m.

Moneybarn provides car finance to non-standard customers in the UK, operating mainly through brokers with additional distribution sourced through independent car dealers and from its website directly to customers.

The business offers secured car loans and cars are typically used for necessities such as travelling to work rather than for luxury or leisure.

Bradford-based Provident said the acquisition will broaden its product offering to the group’s target customer base and will create a third leg of earnings.

Peter Crook, chief executive of Provident Financial, said: “I am delighted that Provident Financial is able to announce the acquisition of Moneybarn, which is the market leader in the non-standard car finance market. “The acquisition provides an exciting opportunity to create a third leg of earnings that complements the organic growth opportunities available to the group. I look forward to working with Peter Minter and his team to realise the significant growth opportunity in this market.”

Moneybarn made a pre-tax profit of £5.5m last year.