Philippines Auto Finance Market Outlook to 2023
By Banks and NBFCs including Captive Units (Auto Loan Portfolio and Motor Cycle Loan Portfolio), By New and Used Motor Vehicles, By Motor Vehicle Financed (Passenger and Commercial Vehicles), By Loan Time Period
Region:Asia
Author(s):Anish Malhotra, Harsh Mittal
Product Code:KR828
July 2019
124
About the Report
Philippines Auto Finance Market Overview and Size: Philippines auto finance market has been identified in its growth stage. The auto finance market tends to align itself with the domestic market for automobiles. Given its relation with this huge market, the sector naturally plays an important role in the overall growth of the economy. During the last 5 years, the auto finance market has boomed as demand and supply for automotives was growing at double digits year on year. Lenders (supply side entities), in this period have evolved to provide a range of innovative products and services to further improve attraction and penetration of the market. There have been various factors driving the growth of the Philippines auto finance market by value as well as by credit disbursed. Some of these factors are the growing economy of Philippines, increasing motorization rate, increased disposable income leading to an increase in purchase of automobiles and the advent of web aggregators. Along with these factors, an increase in per capita income has led more households to own an automobile in Philippines.
By Type of Motor Vehicle Loans Provided By Banks and NBFCs (Auto Loan Portfolio and Motor Cycle Loan Portfolio): In Philippines, auto loan is disbursed only for passenger vehicles including passenger cars, utility vehicles, sports utility vehicles; and commercial vehicles including trucks, buses and trailers. Motorcycle loans provided to finance two wheelers in the country. Auto loan provided by both banks as well as NBFCs was observed to dominate the market during 2018. The total loan portfolio provided by the banks for financing automotives has grown over the review period.
By Type of Motor Vehicle (New Vehicle and Pre-Owned Vehicles): Loanfinancing provided for new vehicles established itself as market leader in the Philippines auto finance market during the year 2018 owing to the advantages that come handy with the new vehicles that includes higher resale value and better financing schemes. Pre-owned vehicles captured limited share in the market.
By Type of Motor Vehicle Financed (Passenger Vehicle and Commercial Vehicle): Passenger vehicles are used for domestic purpose either by family or an individual for personal use whereas commercial vehicles are majorly used for business purpose. Passenger vehicle financing dominated the Philippines auto finance market during the year 2018. Heavy traffic coupled with rising prices of the car is letting Filipinos to shift from cars to motor cycles in Philippines.
By Time Period of Loan (1, 2, 3, 4, 5 and more years) Between New and Pre-Owned Motor Vehicles: The loan tenure selected by the customer depends on factors such as the price of the car, income level of the customer, flexible scheme options and other social factors such as family size and life style of the individual. The maximum tenure allotted for a car loan by both banks and private finance companies is seven years for new car. It has been observed that, people opting for five year loan tenure dominated the Philippines auto finance market in 2018 followed by 3 year, 4 year, 2 year and 1 year loan tenure period.
By Vehicles Registered Under Various Regions: Number of new vehicles sold in NCR was observed to be higher compared to all other Filipino regions. The heavily populated capital city along with emerging business opportunities in the city has given a boost to commute via cars / motor cycles.
Comparative Landscape in the Philippines Auto finance Market: Competition within the Philippines auto finance market was observed to be highly fragmented along with majority the motor vehicle loans being financed by Banks and the rest small portion is financed by Non Banks and Dealerships. Some of the leading banking institutions include Metro Bank, BDO, Ps Bank, East West Bank, the Philippine National Bank (PNB Saving Bank), Bank of the Philippine Islands, RCBC, May Bank Philippines Incorporated and others. However, stiff competition was observed in the case of NBFCs and dealerships operating in the Philippines including Toyota Financial Services Philippines Corporation, MAFS, Unistar Credit and Finance Corporation, Radio Wealth finance Company and others. Parameters on the basis of which companies compete in the market include price, digitalization, customer centricity, type of distribution network, service portfolio and others. Although there are approximately 100-150 entities involved in extending auto finance in Philippines, the market is dominated by banks in terms of auto loans extended owing to low cost of financing and high trust factor associated with their organized and stable business structures.
Philippines Auto Finance Market Future Outlook and Projections: Over the forecast period, Philippines auto finance market is expected to be positive if there is continuous need for motor vehicle among population. Multiple fin-tech startups have also come up in the country’s financial sector which poses a threat to multi finance companies. These start ups have developed products to augment the digitalization of the banking sector. This includes digital payments, online lending and remote banking facilities which made customer lending process uncomplicated further facilitating the car finance market in the country. Non-banks and dealerships services are expected to outpace the growth in banking institutions because of their customized products and ease to approach. The turnaround time to finance is also relatively less compared to banking institutions. In addition to that, the Philippines auto finance market is likely to witness a boom in terms of number of auto loans sanctioned especially on the technological front. Moreover, a rise in commercial activities engaging automobiles such as rising use of vehicles in public transport, agricultural and industrial use, are expected be the potential prospects of growth in the next five years.
Key Topics Covered in the Report
- Philippines Auto Finance Market Evolution
- Philippines Auto Finance Market Overview and Genesis
- Philippines Auto Finance Market Ecosystem, 2018
- Philippines Auto Finance Market Value Chain Analysis
- Philippines Auto Finance Market Size, 2013-2018
- Philippines Auto Finance Market Segmentation, 2013-2018
- Major Trends and Development in Philippines Auto Finance Market
- Regulatory Framework in the Philippines Auto Finance Market
- Snapshot on Philippines Automotive Sales And Manufacturing Market, 2013-2023
- Comparative Landscape in the Philippines Auto Finance Market
- Philippines Auto Finance Market Future Outlook and Projections, 2018-2023
- Analyst Recommendations for the Philippines Auto Finance Market
Products
Key Target Audience
- Existing Auto Finance Companies
- Banks & Subsidiaries
- Auto OEM Captive Finance Companies
- Non Banking Financial Institutions
- New Market Entrants
- Automobile Financing Companies
- Government Organizations
- Investors
- Automobile Associations
- Automobile Original Equipment Manufacturer
Time Period Captured in the Report:
- Historical Period: 2013-2018
- Forecast Period: 2018-2023
Companies
Key Segments Covered
By Type of Motor Vehicle Loans Provided By Banks and NBFCs
- Auto Loan Portfolio
- Motor Cycle Loan Portfolio
By Type of Motor Vehicle
- New Vehicle
- Pre-Owned Vehicles
By Type of Motor Vehicle Financed
- Passenger Vehicles
- Passenger Cars
- Utility Vehicles
- Sports Utility Vehicles
- Two Wheelers
- Commercial Vehicles
- Trucks
- Buses
- Trailers
By Time Period of Loan between New and Pre-Owned Motor Vehicles and
- One Year
- Two Year
- Three Year
- Four Year
- Five Years and More
Key Companies Covered:
Banking Institutions
- Metro Bank
- BDO Bank
- PS Bank
- East West Bank
- Philippine National Bank
- Bank of the Philippine Islands
- Maybank Philippines Incorporated
- Others
Non-Banks and Dealership Financing
- Toyota Financial Services Philippines Corporation (TFSPH)
- MAFS
- Unistar Credit and Finance Corporation
- Radio Wealth finance Company
- Others
Table of Contents
1. Executive Summary
2. Research Methodology
2.1. Market Definitions
2.2. Abbreviations
2.3. Market Size and Modeling
2.4. General Approach – Market Sizing
2.5. Market Sizing – Philippines Auto Finance Market
2.6. Variables (Dependent and Independent)
2.7. Multi Factor Based Sensitivity Model
2.8. Regression Matrix
2.9. Final Conclusion
3. Philippines Auto Finance Market Evolution, 1900-2018
3.1. Market Entry of Major Players, 1850-2018
3.2. Change in Sector Related Policies & their Effect on Philippines Auto Finance Market, 2011-2018
4. Philippines Auto Finance Market Overview & Genesis
4.1. Market Overview
5. Philippines Auto Finance Market Ecosystem, 2018
6. Philippines Auto Finance Market Value Chain Analysis, Customer Pain Points & Decision
Making, 2018
Online Aggregators
6.1. AutoDeal Philippines
Vendor Selection Process in Philippines Auto Finance Market
Major Pain Points of Various Entities In Philippines Auto Finance Market
7. Philippines Auto Finance Market Size (By Credit Disbursed, Auto Loan Outstanding & Number of
Automobiles Financed), 2013-2018
7.1. Loan Proportions, 2013-2018
7.2. Major Business Stratergies, Company Positioning, Mergers and Aquisitions & Payment Methods, 2018
7.3. Ways To Finance A Car In Philippines Auto Finance Market (Bank Finance Or Multi Financing Companies, 7.4. Personal Finance, Lease Financing), 2018
7.5. Different Ways To Finance A Car In Philippines Auto Finance Market, 2018
7.6. Prevailing Interest Rates in Philippines Auto Finance Market, 2018
8. Philippines Auto Finance Market Segmentation, 2013-2018
8.1. Market Segmentation By Type of Motor Vehicle Loan Provided –Auto Loan and Motor Loan (By Banks & Non Banks), 2013-2018
By Banks On the Basis of Motor Loan Vehicle Portfolio, 2013-2018
By Non-Banks On the Basis of Motor Loan Vehicle Portfolio, 2013-2018
8.2 By Type of Motor Vehicle-New and Pre Owned Vehicles, 2018
Further Split On the Basis of Loan facilitating Institutions (Banks & Non Banks)
8.3 Market Segmentation on the Basis of Type of Motor Vehicle (Passenger & Commercial) Financed, 2015-2018P
8.4 Market Segmentation By Time Period of Loan (1, 2, 3, 4, 5 and more years) for New and Pre-Owned Motor Vehicles, 2018
On the Basis of Loan Term for New Vehicle, 2018
On the Basis of Loan Term for Pre Owned Vehicle, 2018
8.5 Market Segmentation By Volumes Of Vehicles Registered Under Various Regions, 2018
On the Basis of Number of Vehicles Financed, 2018
On the Basis of The Disbursment of New Motor Vehicle Loan Reigion Wise, 2018
On the Basis of The Disbursment of New Motor Vehicles Segmentation By Disbursement, 2018
9. Major Trends and Development in Philippines Auto Finance Market
9.1. Rapid increase in Non-Bank loan portfolios
9.2. Technological integration and customized products
9.3. Decrease in Car Sales in 2018
9.4. Growth of Used Car Market
9.5. Tax Reform for Acceleration and Inclusion (TRAIN) Act
9.6. Positively Inclining Interest rates & Weaking Autofinance Sector
10. Government Regulations in Philippines Auto Finance Market
10.1. Acts Governing Philippines Financial Institutions
10.2. License Requirements to Operate as a Financial Institution in Philippines
10.3. General Requirement and Documentation Required for a New Car Financing
10.4. Regulatory framework for Multi Finance Companies
10.5. General Requirement and Documentation for Used Car Financing
11. Philippines Auto Finance Market Competitive Scenario
11.1. Market Share of Major Entities in Philippines Auto Finance Market, 2017-2018
11.2. Market Share of Major Banks By Auto Loan Outstanding, 2017 and 2018
11.3. Market Share of Auto NBFCs By Auto Loan Outstanding, 2017 and 2018
12. Company Profiles of Major Banks & NBFC’s in Philippines Auto Finance Market
Company Profile of Major Banks
12.1. MetroBank
12.2. BDO Bank
12.3. PS Bank
12.4. East west Bank
12.5. Philippine National Bank (PNB)
12.6. Bank of the Philippine Islands (BPI)
12.7. Rizal Commercial Banking Corporation (RCBC)
12.8. MayBank Philippines Incorporated
12.9. Other Banks in the industry (China Bank, United Coconut Planters Bank, Security Bank Corporation, Union Bank, Robinsons Bank, The Philippine Bank of
Communications & Sterling Bank of Philippines)
Company Profiles of major NBFC’s
12.10. Toyota Financial Services Philippines Corporation (TFSPH)
12.11. Radiowealth finance company (RFC)
12.12. Other NBFCs in the industry (Unistar Credit and Finance Corporation, Asia Link Finance Corporation, Leauge one Finance and leasing Corporation, DBP Leasing
Corporation, First United Finance and Leasing Corporation), 2018
13. Future Outlook and Projections for Philippines Auto Finance Market, 2019E-2023E
13.1. Market Size By Auto Loan Outstanding & Vehicles Financed, 2019E-2023E
13.2. Future Market Segmentation, 2019E-2023E
By New & Pre-OwnedVehicle Financed further Split on Banks and Non Banks, 2018-2023
13.2.1. New Vehicle Financed, 2019E-2023E
13.2.1. Pre Owned Vehicle Financed, 2019E-2023E
By Type Of vehicle (Passenger and commercial vehicles) Financed & Financial Penetration Rates, 2018-2023E
14. Analyst Recommendation
Disclaimer
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