Provident Financial keeps up growth

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The Independent Online
Provident Financial, the Bradford-based provider of door-to-door unsecured loans and non-comprehensive motor insurance, increased profits by 15 per cent to pounds 54.7m in the first half of the year, maintaining its steady upward path.

Home credit turnover rose by 11 per cent to pounds 164m, bad debts increased by 14 per cent to pounds 23.7m, and profits rose 11.6 per cent to pounds 50.8m. The number of customers was up 9 per cent to 1,334,000, and the number of agents, who are mostly recruited from customers, increased by 4 per cent to 10,268.

The formula is well tested and the market still not saturated, but a small pilot operation has been started in Poland and another is being set up in the Czech Republic to see if the business can be transplanted successfully.

The insurance division concentrates on women drivers and third-party, fire and theft business. It resisted the temptation to cut premiums and chase market share. Turnover dropped by a quarter to pounds 45m but profits actually grew by a quarter to pounds 6.7m.

Howard Bell, chief executive, saw no real signs that premiums generally were moving significantly higher, but when they do Provident's business should benefit.

Meanwhile it is market testing a 10-year life assurance policy which offers up to pounds 80,000 worth of cover for a young, non-smoking female down to pounds 5,000 for a male smoker in his fifties for a flat rate of pounds 3 a week over 40 weeks of the year.