The American Financial Services Association (AFSA), in collaboration with Oxford Economics, has released two reports detailing the impact of consumer credit on the U.S. economy. The studies show that vehicle financing and personal lending by finance companies contribute over $145 billion annually to the nation's gross domestic product (GDP) and support nearly 840,000 jobs.
According to the report titled "The Economic Impact of Vehicle Financing in the U.S.," vehicle-finance providers added $125.5 billion to GDP in 2023, which is about $17 for every $100 in loans originated. The sector also supported approximately 680,000 full-time equivalent jobs and generated $24.6 billion in tax revenue at both federal and state levels.
In 2023, financial institutions originated 30.2 million vehicle loans and leases worth a total of $727 billion, assisting many households in purchasing vehicles needed for daily life.
Tim Gill, Chief Economist for AFSA, said: “The spillover effect of vehicle sales and financing is significant across the United States and extends well beyond the vehicle manufacturers, dealers and lenders. At every level of the vehicle, dealer and lender supply chain, there are communities, businesses large and small and consumers who both directly and indirectly benefit economically.”
A companion study focusing on personal lending found that such activity contributed $20.4 billion to GDP last year, supported 159,000 jobs nationwide, and generated $4.9 billion in tax revenue. Finance companies issued 12.5 million personal loans totaling $62 billion in value; many of these loans served lower-income or subprime borrowers without access to traditional bank credit.
“These findings reaffirm that responsible consumer lending doesn’t just help individuals access the credit they need in communities across America – it powers the broader economy with more than $145 Billion impact annually and support 840,000 jobs,” said Celia Winslow, President and CEO of AFSA. “From putting families on the road to helping consumers meet life’s everyday expenses, our members keep the American economy moving.”
The reports indicate that Texas and California saw the largest economic impacts from both vehicle financing and personal lending activities combined—together accounting for over $36 billion in GDP impact ($21.3 billion for Texas; $15.3 billion for California). Forty percent of all vehicle financing occurred in Texas, California, Florida, New York, and Georgia; per capita figures were highest in Texas, Florida, and New Hampshire.
For personal lending specifically, Texas accounted for 13 percent of all loan value provided by finance companies nationwide.
The concentration of economic benefits is attributed to strong consumer demand as well as large markets for vehicles and established financial services sectors within these states.