Direct lenders’ rates are likely to rise in the wake of the turmoil surrounding Northern Rock, and make point-of-sale offerings more attractive and competitive.

Black Horse managing director John Woolley says: “Difficulties with Northern Rock’s funding will make it more challenging for the bank to compete. It has always set the benchmark for a lot of the low direct lender rates.

“People will always have a desire to buy a car – it’s all down to affordability. Our challenge will be to make sure we fulfil this desire. We need to be show how competitive we are – the Northern Rock issue will help – and provide products that will make this happen. PCPs are a good example of this.”

In widespread speculation, Lloyds TSB was reported to be one of more than a dozen of Europe’s biggest banks to decide not to buy Northern Rock.

Potential buyers are thought to have been deterred by the danger of the Northern Rock brand being irreparably damaged and the prospect of a lengthy investigation into takeover competition issues.