Digital transformation bags strong results for Hitachi Capital Consumer Finance

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Hitachi Capital Consumer Finance (HCCF), one of the UK’s leading retail point of sale provider today announces impressive profits of £60.2m and growth in market share, illustrating resilience despite volatility in the lending landscape in FY20/21. The results and continued investments during the period leave the business well positioned to grow in 2021/22 as lockdown measures ease and consumer confidence returns.

In total, Hitachi Capital Consumer Finance lent £1.7billion, including over £1.1billion to 3,200 UK High street and online retail partners. Exceptional growth via digital channels, propelled by a 34% increase in retail point of sale finance merchant integrations to drive online and mail order sales conversions, lead to an 87% increase in lending volumes via e-commerce channels.

HCCF’s personal loans business, Hitachi Personal Finance, gained market share in a supressed market with new business volumes of £648m, which cemented its position as one of the top 10 providers of personal loans in the UK.

The business unit’s commitment to providing a frictionless, outstanding customer journey for 1.3 million customers, has seen HCCF continue to invest in technology with increased demand for self-service across digital channels, including undertaking improvements to its MyHPF mobile app.

HCCF continues to maintain a strong brand reputation for providing market leading customer experiences, exceeding industry benchmarks for its customer satisfaction performance. HCCF achieved a score of 94.7 for customer satisfaction in the latest Institute of Customer Service independent survey – well above the average for banks and building societies (79.1) and the all-sector UK average (77.0). 

Hitachi Personal Finance was awarded the Feefo Platinum Trusted Service Award in 2021 for the third consecutive year and has retained its position as the UK’s Best Direct Personal Loan Provider in the Your Money Awards for seven years running. HCCF also received two European Contact Centre & Customer Service Awards in recognition of the business unit’s response to the pandemic: The Gold award for Responding in a Crisis (supporting colleagues) and the Silver award for Responding in a Crisis (supporting customers).

Vincent Reboul, Managing Director at Hitachi Capital Consumer Finance, said:

“Despite a turbulent year, with subdued lending demand and an unprecedented increase in customer contact during the first quarter lockdown, we continued to provide outstanding service to support our customers and retail partners. 

“Our agile response to the pandemic, including accelerating our strategic investment in digital channels in order to adapt to the surge in demand via e-commerce channels, enabled us to continue to deliver against our strategic priorities and achieve some very impressive results.

“Cementing our position as one of the top 10 providers of personal loans in the UK, HCCF defied the sharp decline in demand for unsecured lending to continue to gain market share in a competitive sector where rates remain at historic low levels.

“With a strong recovery in consumer spending expected during the coming months, our business is primed for sustained growth to benefit from an enhanced multi-channel proposition moving forwards.”

At a Group level, Hitachi Capital (UK) PLC has reported a profit before tax (PBT) of £104m for the 2020/21 financial year.

Despite a decline of almost 10% in GDP, Hitachi Capital (UK) PLC generated £3.3bn of new business, with a strong recovery in the second half of the year maintaining Hitachi Capital UK’s level of Net Earning Assets at £5.9bn.

New business volume in the first six months of financial year 2020/21 recovered to 69% of 2019/20 levels and in the second half of the year, new business volume was at 99.7% of the previous year, despite two further lockdowns.

Robert Gordon, CEO of Hitachi Capital (UK) PLC, said: “The extraordinary resilience, determination and agility of everyone in our business to adapt quickly to the environment has delivered outstanding results during an extremely challenging year.

“Our continued success and recovery, particularly over the second half of the year, has been achieved by adjusting to the pandemic conditions, accelerating our digital capabilities in line with evolving customer expectations and consistently providing outstanding service to businesses and individuals through the range of financial products we offer.

“Underpinned by our continued access to funding in financial markets reflecting our reputation and portfolio quality, the business has remained well capitalised throughout the pandemic and gained market share, outperforming competitors in key industry sectors.

“Amid the backdrop of heightened uncertainty, we have continued to invest in our business and our people; during the past year, we’ve implemented technological improvements to drive operational efficiencies as well as providing funding to support sustainable energy projects addressing climate change. The business experienced significant increased demand for communication and support from our customers over the past 12 months. In turn, we’ve increased our headcount and did not participate in furlough programmes during the COVID-19 crisis.

“We’ve seen continued momentum in new business volumes during the first quarter of 2021/22 aligned to an upturn in consumer confidence and pent up demand. Hitachi Capital (UK) PLC is well-diversified across commercial and consumer sectors with an expanding portfolio to tackle climate change. With a high level of liquidity, our business is well placed to grow in this financial year as the economy gathers pace in the months ahead.”