case study
It’s often said moving home is one of life’s most stressful experiences and it can be even more challenging when moving to a new country. When one of Investec’s clients – a South African national – recently relocated to the UK, she needed a new vehicle to quickly get back on the road, without adding to the stress of her recent move.
She also required an efficient vehicle which adhered to the city’s emissions regulations, at an affordable price due to her money being tied up in the move.
With little credit background in the UK, our client turned to her private banker at Investec. They connected her to a member of the team at our vehicle finance subsidiary Mann Island Finance, who supported her through the entire process of finding and funding a hybrid electric vehicle.
Thanks to her connection to Investec, and with Mann Island’s support through affordability checks, she was able to receive the keys to a hybrid Audi Q5 within a week of making contact.*
As part of the UK government’s commitment to achieve net zero emissions by 2050, the sale of new petrol and diesel vehicles will end by 2030, supported by a £1.8billion investment into infrastructure to increase access to zero-emission vehicles.
While this deadline is still a few years out , the electric vehicle (EV) market has grown quickly since the announcement of the legislation in 2020, with over 420,000 pure-electric cars on UK roads at the end of February 2022.
Here, John Hughes, Managing Director at Mann Island Finance, shares his views on the market and considerations for high-net-worth individuals looking to finance an electric vehicle.
Have you observed an increasing interest in electric cars at the moment?
There has undoubtedly been an increasing interest in EVs as the market has started to transition from traditional internal combustion engine vehicles. This motivation has largely been driven by a desire to support the green agenda, to comply with future legislation and the government’s 2050 net zero emissions target.
Accessibility has also been a key factor; there is simply more choice for people when it comes to buying an electric car than there was a number of years ago. Coupled with growing infrastructure to enable the recharging of electric vehicles and rising fuel prices, people are naturally gravitating towards more sustainable options.
There is simply more choice for people when it comes to buying an electric car than there was a number of years ago.
What electric models in particular are clients interested in?
Clients come to us for various reasons when looking to finance an EV – whether it's for day-to-day use, leisure or simply to reduce their carbon footprint. This can often dictate their choice, so we’ve seen interest in a range of different EVs.
For a number of our high-net-worth clients, Tesla vehicles have been a popular choice due to the well-known brand, high-quality experience and efficiency. Other models, including those by Nissan, BMW, Audi and Kia, are also generating demand.
Why do some high-net-worth clients choose to take a car on finance?
One of the main reasons clients decide to take out finance on a car is to preserve their cash flow. It can be a more efficient way for clients to budget.
For example, many clients will have money tied up in investments, while others who are looking to make a significant purchase will want to spread payment across a timeline that better suits their financial needs.
Our financial solutions help to give clients that added flexibility. In many cases we can also offer no-deposit options, or more favourable interest rates than those offered by dealerships.
When a client has seen their dream car, or simply needs instant access to a vehicle, we can also help clients to secure finance quickly. With the right background checks, it can be possible to get accepted for finance and turn around a deal within 24 hours.
One of the main reasons clients decide to take out finance on a car is to preserve their cash flow. It can be a more efficient way for clients to budget.
What if I have a complex income? Is it still possible to secure finance on a vehicle?
It’s not uncommon for high-net-worth individuals to have a highly complex income stream. This can include dividend payments, lump sum bonuses or even foreign currencies. For international clients, there may also be the added difficulty of having little or no domestic credit history.
As everyone’s situation is different, it’s important to work with a lender that understands your financial background and can offer a bespoke solution depending on your needs. Mann Island Finance is a subsidiary of Investec and we have experience in working with complex cases.
For customers with specific needs, or little credit background, we will always work closely with them to ensure they have an appropriate solution and can afford the repayments.
What other things should potential clients look for, beyond finance, when working with a lender?
It’s important to work with a provider that takes the stress out of the entire process. We know a lot of our clients are time-poor, or simply want access to a vehicle at short notice, so we work efficiently and support the process from end to end.
From the initial enquiry, through to sourcing a car, getting a quote organising delivery, we ensure clients are updated every step of the way and they can receive their vehicle at a time convenient to them.
Speak to a private banker about your lending needs
Disclaimer
Mann Island Finance is a trading style of MI Vehicle Finance Limited, which is authorised and regulated by the Financial Conduct Authority (FCA) for credit-related regulated activities. Registered office: Reading International Business Park, Reading, RG2 6AA. Registered in England. Company registration no. 05643927. Part of the Investec group of companies. Business or high-net-worth customers may not be protected under the Consumer Credit Act 1974 or FCA rules.
This article is for general information purposes only and should not be used or relied upon as professional advice. You should always seek independent professional advice before making any financial or investment decision. Separate eligibility criteria, terms and conditions apply for MI Vehicle Finance Limited products and services.
Separate eligibility criteria, terms and conditions apply to Investec Bank plc.
*This example is based on the Mann Island Finance service and does not necessarily reflect one case study in particular.
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