Tightened Regulations on Consumer Finance and Declining New Car Sales to Slower the Market Growth: Ken Research

• Rising trend in the new and used car prices is expected to continue further as the imports of components are still expensive
• Introduction of VAT towards the end of 2016 is expected to adversely impact the demand for cars leading to a fall in the demand for car finance
• Private financing sector is expected to have an advantage over the banks amid the tightened regulations with regards to the share of loan in an individual’s monthly income and maximum loan limit

Though at a slow pace, the Egypt car finance market is anticipated to recover during the forecast period 2017-2021, from the fall in the credit disbursement that has been observed towards the end of the review period. The competition in the market is expected to rise amid the tightened regulations and the dealership financing would have an advantage over the banks since they are not bound by the regulations. As the price of new and used cars is displaying a consistent rise, the customers, expecting a further increase in the car prices are anticipated to buy immediately. This is expected to increase the demand for car loans and raise the amount of credit disbursed.

Many banks are in plans to expand more in terms of number of branches within the country. In Egypt, there are several untapped geographical regions for banking. Many people in Egypt are still dependent on the dealership financing while buying a car due to the lack of accessibility to banks. This has induced the leading banks in the country to focus on improving the reach for customers.
As a result of the new regulation of CBE on consumer lending, within three years the banks are expected to reduce the maximum loan extended to both single and corporate client. It will be reduced from 20% to 15% of the bank's Tier I capital for a single client and 25% to 20% for a corporate client. The expectation is that reducing the share of a client’s loan from their monthly income after taxes, will increase the likelihood that customers will be able to repay their debts, while reducing the risk to the bank of credit default on the loan, or late payment. With regards to the new corporate loan structure, the aim is to reduce banks’ dependence on a few large clients and diversify their Tier I credit portfolios.
Ken Research in its latest study, Egypt Car Finance Market Outlook to 2021, observed that the introduction of the introduction of VAT by the government towards the end of 2016 is expected to adversely impact the automotive industry. The new car sales are expected to fall due to the increase in the cost to be incurred for the purchase of a car.  Amid competition in the market, several players are in plans to introduce more bundling options in loans. For banks, car loans are a more attractive proposition when it is packaged with a suite of other products that cater to multiple customer requirements.
The Egypt car finance market is estimated to register a positive CAGR during 2016-2021. Increased accessibility to finance, new and attractive schemes and offers, increased rate of used car financing and such other factors are expected to be key drivers for a growth in the demand for car finance in the country.
The report provides information on the number of new cars financed, new and used car penetration, tenure of new and used car loan and the regions dominating the market in terms of credit disbursed and number of cars financed. It also covers the major players in the market such as Arab Bank, Bank of Alexandria, Bank Audi, National Bank of Egypt and Banque Misr.
Topics Covered in The Report

• Auto & Car Loans in Egypt
• New Car Sales in Egypt
• Used Car Sales in Egypt
• Cairo Auto Loan Market
• Auto Loans Market in Egypt
• Car Loans Industry in Egypt
• Applying Car Loan in Egypt
• Car Loan Brand New Market
• Financing Schemes Car Loans Egypt
• Auto Loans Terms and Conditions in Egypt
• Interest Rate Car Loan in Egypt
• Top Egypt Car Loans Banks
• Cairo Average Loan Rate
• Finance the Car in Egypt Process
• Car Financing Option in Egypt
• Auto Finance Opportunities in Egypt
• Compare Auto Loans in Egypt
• Vehicle Financing in Egypt
• Used Car Sales in the Egypt
• Passenger and Commercial Vehicles Sales in Egypt

For further reading click on the link below:
https://www.kenresearch.com/banking-financial-services-and-insurance/loans-and-advances/egypt-car-finance-market/124560-93.html
Related Reports by Ken Research
UAE Car Finance Market Outlook to 2021 – Rising Car Finance Penetration and Multiple Car Finance Products Offered by Banks to Foster Growth
India Car Finance Industry Outlook to 2020 - Driven by Spurring Car Sales and Reduction in Average Ownership Period
Case Study-Premium Car Exchange Market in India- Focus on Audi, BMW and Mercedes with Concentration on Marketing Initiatives
Contact Us:
Ken Research
Ankur Gupta, Head Marketing & Communications
Ankur@kenresearch.com
+91-9015378249

Car Finance Market Outlook to 2021 -Ken Research

Ken Research Latest Report on “Egypt Car Finance Market Outlook to 2021 – Stringent to Introduce Innovative Measures to Determine the Credit Worthiness” which provides an extensive analysis of car finance market in Egypt. The report covers market size on the basis of credit disbursed, number of cars financed and new and used car penetration, segmentation on the basis of new and used car finance, tenure of loan for new car and used car and number of new cars financed in each region. The report also includes the rules and regulations implied by the government on the banks in lending a car loan, competitive landscape and company profiles for major players in the car finance market. The report provides detailed overview on the general features of car loan in the country and future outlook & projections with future strategies of the players in the market.
The report facilitate the readers with the in-depth analysis of the existing and future trends and issues that impacts the industry and has anticipated growth in the future depending upon changing industry dynamics in coming years. The report is useful for prospective borrowers, car dealers, banks, non-bank financing companies and other stakeholders to plan their market centric strategies in accordance with the ongoing and expected trends in the future.

Industry Overview
The market has displayed a steady growth trend until 2015 during the review period, 2011-2016 at a CAGR of ~%. In 2016, there had been a fall in the credit disbursed for passenger and commercial cars as a result of the falling demand for cars in the country. The growth exhibited by the market during the initial five years of the review period was supported by factors such as increasing demand for new and used cars, larger supply of used cars, increased demand for commercial cars and other related factors. Fall in the credit disbursement observed during 2016 was resulted out of the increased new car prices, reduced supply of used cars, rising fuel prices, tightened CBE regulations and other such factors.
Egypt Car Finance Market Segmentation
Egypt car finance market is segmented by new and used car finance, by tenure of loan for new and used car, by finance source and by region.
On the basis of credit disbursed the new car dominates the market with a share of ~% in 2016 followed by used cars.
For new cars, the tenure of five years dominates the car finance market with a share of ~% on the basis of number of new cars financed in 2016. It is followed by three years, two years, one year and other tenures.
For used cars, the tenure of three year accounted for the highest share in the market during 2016 on the basis of number of used cars financed, which was ~%. Banks dominate over the private financing sector in the market with a share of ~% in terms of credit disbursed.
Cairo holds the highest share among all other regions of Egypt in terms of number of new cars financed. It held a share of ~% during 2016. Alexandria holds the second position in the market followed by Giza, Luxor and others.
Competitive Landscape
Non-bank financial companies are still underdeveloped in the country, hence the major source of private finance in Egypt is dealership financing. The banks held a share of ~% in the market in terms of credit disbursed for car finance followed by private finance with a share of ~% during 2016. There are nearly 41 banks spread across Egypt. All these players are competing against each others on the basis of interest rates, loan tenure, minimum salary requirement, down payment and other related parameters. The major players in the market are Bank of Alexandria, Banque Misr, National Bank of Egypt, Bank Audi and others. Dealership financing is of great importance within the country due to the accessibility and faster loan processing system of the dealers. The lack of banking penetration is also a factor that raises the demand for financing through dealers.
Future Potential of Egypt Car Finance Market
During the forecast period 2017-2021, the Egypt car finance market is expected to recover slowly from the fall it has experienced towards the end of the review period, 2011-2016. It is anticipated that the car finance market in the country will grow at a CAGR of ~% during the forecast period 2016-2021. The recovery is presumed to be at a slow pace due to various factors such as tightened CBE regulations, rising prices in new car prices, shortage in the supply of used cars, introduction of VAT and such other factors. However, a growth is expected to be observed in the market owing to the government initiatives taken to stabilize the economy, increased demand for used cars, increased offerings from the banks and dealers and other factors.
Key Topics Covered in the Report:

• Egypt Car Finance Market Overview and Genesis
• Value Chain Analysis of Egypt Car Finance Market
• Egypt Car Finance Market Size
• Egypt Car Finance Market Segmentation
• Government Regulations on Egypt Car Finance Market
• Auto & Car Loans in Egypt
• New Car Sales in Egypt
• Used Car Sales in Egypt
• Cairo Auto Loan Market
• Applying Car Loan in Egypt
• Car Loan Brand New Market
• Financing Schemes Car Loans Egypt
• Auto Loans Terms and Conditions in Egypt
• Interest Rate Car Loan in Egypt
• Top Egypt Car Loans Banks
• Cairo Average Loan Rate
• Finance the Car in Egypt Process
• Car Financing Option in Egypt
• Auto Finance Opportunities in Egypt
• Compare Auto Loans in Egypt
• Vehicle Financing in Egypt
• Used Car Sales in the Egypt
• Passenger and Commercial Vehicles Sales in Egypt

For further reading click on the link below:
https://www.kenresearch.com/banking-financial-services-and-insurance/loans-and-advances/egypt-car-finance-market/124560-93.html
Related Reports by Ken Research
UAE Car Finance Market Outlook to 2021 – Rising Car Finance Penetration and Multiple Car Finance Products Offered by Banks to Foster Growth
India Car Finance Industry Outlook to 2020 - Driven by Spurring Car Sales and Reduction in Average Ownership Period
Case Study-Premium Car Exchange Market in India- Focus on Audi, BMW and Mercedes with Concentration on Marketing Initiatives
Contact Us:
Ken Research
Ankur Gupta, Head Marketing & Communications
Ankur@kenresearch.com
+91-9015378249