Foreign carmakers offer more auto-loans to consumers
In Russia's booming banking sector more services are appearing to increase the purchasing power of Russian consumers.
Currently one of the most popular services is the auto-loan, with Monday seeing Toyota Bank setting out to establish itself in the fast-growing sector. It has opened its first branches in Moscow and is planning to expand across Russia by the end of 2007.
Analysts say that, with the growing demand for foreign cars, other international players are likely to follow. It is believed that Volkswagen, Ford, Daimler-Chrysler and BMW are already looking to start retail lending.
Russians are dismissing the purchase of an apartment as a dream and instead are turning to cars. The number of cars is growing every month; some Russian families already have more then two. The reason is the popularity and availability of car loans at almost all Russian banks.
Analysts say such a move will increase the competition in the market and in the long term will even push out some local banks. International banks focusing on car lending in Russia are likely to lead to long-term diversification of the sector, with analysts predicting that some local banks may end up struggling as they try to keep up with the new entrants.