The report provides a comprehensive analysis of the potential of auto finance industry in Philippines. The report covers an overview and genesis of the industry, market size in terms of auto loan disbursed.

The report has market segmentation which include segments by category of lenders, by nature of vehicle, by type of vehicle financed, by type of vehicle financed by banks, by type of vehicle financed by NBFCs, by loan tenure; growth enablers and drivers; challenges and bottlenecks; trends driving adoption trends; regulatory framework; end-user analysis, industry analysis, competitive landscape including competition scenario and market shares of major players. The report concludes with future market projections of each market segmentation and analyst recommendations.

Market Overview:

According to Report Ocean estimates, the Philippines Auto finance Market -has increased in 2022 at a CAGR of $% owing to growing demand for used vehicles and financing penetration in the sector.

Launch of new models and initiatives to support electric vehicle adoption in Philippines by automakers stimulate the consumer interest in autos. Companies have started focusing on increasing the volume along with preserving the margin. Promos are focused on value enhancement than price.

Security Bank Corporation's consumer finance arm SBF has partnered with Grab Philippines to offer personal loans to Grab users, driver-partners, and merchant-partners through the Grab super app.

Key Trends by Market Segment:

By Category of Lenders: Banks are preferred over NBFCs and captives due to their lower interest rates and longer repayment tenure.

By Nature of Vehicle: Banks tend to focus on brand new vehicles as it gives them higher value at their disposal and to maintain a portfolio level for repossession as advocated by central banks. NBFCs tend to penetrate used car markets as banks are highly active in new car financing. Also, the market has lower margins and NBFCs do not want to compete against banks.

Competitive Landscape

All major banks in the Philippines finance all passenger vehicles to cater to the diverse needs of borrowers and to remain competitive in the market. The Market is moderately fragmented. BDO, PNB, RCBC, Maybank and Metrobank can be positioned as leaders in Philippines Auto Finance Market owing to their large customer base, demand for auto loans and higher digital penetration.

Future Outlook

The Philippines Auto Finance Market witnessed significant growth during the period 2017-2022, NBFCs will emerge as the major auto financier in the future owing to the lack of regulatory limits on them unlike Banks and NBFCs in providing auto loans. New cars are likely to meet the latest fuel efficiency standards and also have attractive financing deals by banks. Low interest rates provided by banks will make it less expensive to finance a new car than a used one."