Proton Commerce Sees Loan Growth In Tandem With Vehicle Sales
Proton Commerce Sdn Bhd is seeing loan volume growth which could see it achieve a record setting year. The growth in its loan portfolio is in tandem with the increase in sales for PROTON, since Proton Commerce is the finance arm of the brand.
In 2018, Proton Commerce disbursed 5,410 car loans which it managed to double in 2019 (10,668 loans). Even in 2020 when there were disruptions to car production and sales, Proton Commerce managed to record 14,189 loan disbursement.
For 2021, Proton Commerce is optimistic of achieving an all-time high volume of 20,000 loan disbursements. “Although there was a downturn in many economic sectors caused by the Covid-19 pandemic, consumer sentiment for car purchases remains positive. PROTON’s gains in product quality, its additions to the dealer network and the launch of new models have grown interest in its cars and we are seeing the results in the number of loan applications received,” said Mooi Fi Phang, Chief Executive Officer, Proton Commerce.
“Our loan disbursement volume for Q1 this year has increased by 42.3% and we are confident of our volume growing even more in Q2. However, the hire-purchase market could face a tough second half of the year as the PENJANA sales tax incentive is scheduled to expire at the end of June so the industry could see a period of correction as market demand finds its natural level,” he added.
Proton Commerce is also seeing a change in the demographics of its customers and Mooi says the age of Proton buyers is trending downwards, indicating the company’s revamped line-up has made it a more trendy choice with younger Malaysians. He also said 80% of Proton Commerce’s customers opt for 9-year hire-purchase financing plans and that impaired loan rates up to three times lower than the industry average.
“2020 was a tough year for the industry as financial institutions had to make modification loss provisions for the 6-month moratorium programme announced by the central bank. Thankfully for Proton Commerce, the financial stability of our customer base meant a very low number of our borrowers opted for subsequent moratorium and with the removal of the provisions this year, we expect to contribute a healthy profit to our shareholders,” added Mooi.
