Black Horse Motor Finance is to stop
funding business introduced by brokers at the end of January, the
Lloyds Banking Group-owned finance house has announced.
The decision, which has come as a blow to the
broker sector, followed a “comprehensive review” of Black Horse’s
operations, and will come into effect from 31 January 2010.
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“Our aim is to always ensure that we are making the
best decisions for our customers and for the business as a whole,”
the funder said. “As a result of this review, we’ve made the
decision to focus more closely on certain business channels – those
partners with whom we have the strongest relationships – and as a
result, from next year, Black Horse Motor Finance will no longer be
working with external brokers.”
One broker who previously worked with Black Horse,
who did not wish to be named, said that the news was “sad but
unsurprising”, adding that the company had been reducing its flow
of broker-introduced business progressively over the year.
An industry observer commented: “In today’s
climate, where it is difficult enough as things stand for funders
to maintain sustainable profit margins, the addition of an
intermediary means that margins are put under even more pressure –
so it is not surprising that we have seen motor finance providers
move away from this space.”
Black Horse reaffirmed, however, its commitment to
the point of sale (PoS) motor finance market: “Black Horse remains
committed to providing PoS finance to motor dealers and maintaining
its market-leading position.
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By GlobalData“We have written to all our broker partners to
explain the decision and all colleagues within Black Horse Motor
Finance have been informed. No colleagues will be affected by this
announcement. This decision does not have any impact on any of the
business streams outside of motor finance – for example, Personal
Finance or Lex Autolease – which also deal with brokers and will
continue to do so.”
A spokesman for Black Horse said that the decision
will affect 14 brokers with which the lender has a
relationship.
“Mann Island is by far the biggest relationship,
accounting for approximately 80 percent of our broker business,”
the spokesman added
