Stoneacre Financial Services (SFS) is preparing to buck the interest rate trend to make car finance more attainable for non-prime customers.

The Thorne-based AM100 retail group will bring its non-prime rate down from 14.9% to 13.9% with its new Tier Zero product which is set to be rolled out on Monday (December 4).

Coming just weeks after the Bank of England increased the base rate from 0.25% to 0.5%, the Tier Zero product should benefit both non-prime consumers looking for a Hire Purchase (HP) deal with no deposit and consumers with non-prime status looking for a Personal Contract Purchase (PCP) package with no deposit, according to Stoneacre.

Stoneacre launched its white label lending facility, SFS, in 2013 as a Joint Venture with Marsh Finance.

The business’s head of digital, Mark Zavagno, spoke about why they made the decision to start the lending facility and how they continue to adapt to the market.

He said: “We wanted to empower our customers who had been victims of the 2008-10 credit crunch, so they could buy a car from one of the country’s fastest-growing franchised motor companies.

“In 2015 we said we would achieve growth by adapting to consumer demands, which will be challenging in 2018. The demand for new cars is declining, interest rates are rising and finance companies appetite for risk will dwindle.

“Our customers need us more than ever. A new, cheaper finance product will help people who have had turbulent credit histories to access affordable credit.”

Stoneacre managing director Shaun Foweather believes the PCP product and its £25,000 maximum credit limit (subject to affordability checks) supports the group’s new car programme.

He said: “It will be beneficial to have a secondary PCP facility to make new cars affordable and attainable for our customers.”

Head of finance and insurance for Stoneacre, David Teatum, discussed the research into the motor company’s decision.

“We have identified a 10% drop in approval rates,” Teatum said. “We can already see the banks passing on the Bank of England rate increase to consumers.

“It’s a good time to launch a new non-prime product and absorb the rate increase by reducing profit margins.”