Motor finance provider to lend more than €100m to motorists this year

VOLKSWAGEN Bank Ireland will lend out more than €100 million in car finance to Irish motorists this year, a record for the firm.

The bank is also considering expanding its service offering in Ireland to include finance for all costs associated with buying a car.

The bank, which is a division of Volkswagen Financial Services, Europe’s biggest motor finance provider, said that in the first nine months of this year it has provided €91m in vehicle finance packages for Irish consumers.

It has been providing vehicle finance in Ireland since 2008 and employs 30 staff at its Dublin headquarters.

With assets of €400m it has provided more than €184m in vehicle finance to the Irish market to-date and it estimates that it will surpass the €100m mark for 2011, which is a landmark for the bank.

General manager of Volkswagen Bank, Mutlu Gur, said: “What is becoming clear is that the Irish consumer is moving away from the traditional banking sector and increasingly accessing finance from alternative providers.

“In particular for big ticket items like car purchases, Irish motorists are eager to engage with Volkswagen Bank because of our keenly priced finance packages and they are reassured by the considerable size and experience of Volkswagen Financial Services which operates across 35 countries.”

He said they could in time consider operating a one-stop shop for a consumer’s total motor needs, which could see the bank offering insurance deals to its customers.

“This is an area that Volkswagen Bank in Ireland will be looking towards in years ahead,” he said.

With an acceptance rate of three in every four applications, around 7,000 finance packages were provided to Irish consumers by Volkswagen Bank Ireland in 2011 with an average finance term of 40 months.

The bank said rates start at 4.9% APR, but added that 2012 will see even more attractive rates, starting from 0%.

Managing director of Volkswagen Group, Simon Elliot, said: “Right now one in every five car purchases is completed via Volkswagen Bank finance. Over the next number of years we see this ratio increasing.

“2012 will be the first year in some time for the Irish motor industry without the influence of the scrappage scheme.

“The ability to provide attractive finance packages will be a key market advantage for Volkswagen Group, setting us apart from our competitors,” he said.