Automotive retailers are steering clear of a source of lucrative business because of worries about image.

According to Finax, part of the Bank of Scotland's capital Bank Motor division, more than half of UK dealers are failing to exploit a potentially huge market in sub-prime finance - a market which can offer significant increases in the levels of commissions earned.

But there's a stigma attached to sub-prime and that's why the trade continues to keep it at arm's length. Paul Hibbert, director at Finax, says more than 21 per cent of applicants are systematically refused normal prime finance for a number of reasons, including County Court Judgements.

“Although dealer perceptions of this specialist market have been more favourable over the last six years we still have some way to go in convincing dealers there are tangible benefits in dealing with this sector,” says Hibbert.

He adds that with the rise in vehicle and finance purchases from other sources, traditional franchised dealers are finding it difficult to maximise profits.