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V12 Retail Finance Q3 Data Shows Home Improvement Finance More Than Doubling



New quarterly data from V12 Retail Finance shows that UK consumers continued to turn to point-of-sale finance for high-value purchases in the third quarter of 2026. Total finance values across the platform grew 7% between July and September compared with Q3 2025, and were almost 20% higher than in the same period of 2024.


The quarter got off to a challenging start as prolonged hot weather and a busy international sporting calendar disrupted normal shopping patterns in July. However, each month of the quarter was ahead of the same month in 2025, and demand strengthened as the summer went on. As in the first half of the year, growth came mainly from categories linked to the home, health and practical everyday purchases. This suggests that households remain willing to commit to significant spending, but continue to be selective about where they do so.


Andrew Phillips, Managing Director of V12 Retail Finance said:

"The third quarter shows a consumer who is still willing to spend on what matters most, even when the backdrop is far from straightforward. July was a difficult month for many retailers, but demand held up and strengthened through August and September."

"The standout trend is the continued investment households are making in their homes. Home improvement finance more than doubled year on year in the quarter, and that reflects a broader shift we have been tracking for some time, as people choose to improve the homes they already have rather than move."


"Consumers remain cautious about the wider economic picture, and we expect them to stay selective. But the strength and breadth of demand across our portfolio gives us confidence as retailers head into Black Friday and the Christmas trading period."


Home improvements emerge as the defining trend of 2026

Home Improvements was a standout performer in V12’s portfolio in Q3. Finance values rose by around 112% year on year, and the pace of growth increased each month. Values were up approximately 56% in July, 107% in August and 163% in September.


The category has now grown almost fourfold in quarterly value since Q3 2024, and now accounts for around 7% of total finance values, compared with less than 4% in the same period last year. Across the first nine months of 2026, home improvement finance values are up by around 73% year on year. This builds on the multi-year pattern of increased investment in property-related projects that V12's earlier data releases highlighted.


Furniture remains the anchor of demand

Furniture remained the largest category by a significant margin, accounting for close to 49% of all finance values in Q3 2026. Finance values held broadly stable, rising around 1.5% year on year on what had been a strong Q3 2025.


Performance varied through the quarter, with July softer as warm weather reduced footfall, particularly at retail park locations. August was a stronger month for the category, with finance values rising nearly 9% year on year as cooler temperatures and Bank Holiday promotional activity brought customers back to stores. On August Bank Holiday Monday alone, applications approved across V12's portfolio rose by almost 40% compared with the same day in 2025, with furniture retailers making a significant contribution.


Healthcare and practical categories continue to grow

Healthcare and dental finance values rose by around 6% year on year, and are up by more than a third compared with Q3 2024. The category accounted for around 12% of V12's total finance values in the quarter. This reflects continued consumer willingness to invest in dental and elective treatment, supported by the expansion of V12's healthcare provider network.


Growth was also strong across several practical and lifestyle categories. Consumer electrical finance values more than doubled year on year, rising by around 126%. Cycles grew by around 24%, with double-digit growth in every month of the quarter. Motor finance rose by close to 6%.


Signs of stabilisation in discretionary categories

In Q1, discretionary luxury categories were under pressure. In Q3, there were early signs that this pressure is beginning to ease. Jewellery, the second largest sector by value, returned to growth, with finance values rising nearly 3% year on year. This marks a positive step after a softening trend that had been evident since mid-2024.


Other discretionary categories remained more subdued. Art saw a decline of close to 8%, while music was broadly flat. This suggests that while sentiment around non-essential purchases may be improving, households are still exercising restraint in some areas.


Retailer network continues to expand

V12's retailer network continued to grow during the quarter. The most significant milestone was the launch of V12's partnership with Magnet, which went live across all 150 Magnet stores in July and made a strong early contribution to the growth in home improvement finance. The sector also benefited from continued growth among retailers introduced through broker partners.


"What has been particularly encouraging this quarter is how broad the growth has been," added Andrew Phillips.

"We have seen strength in our largest categories, in healthcare and in practical purchases, and early signs of recovery in jewellery. Combined with the momentum in home improvements and new partnerships such as Magnet, that gives us a solid platform as we move into the busiest trading period of the year."

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Businesses could lose the battle for talent due to automation, warns leading workforce solutions provider, Reed Talent Solutions, with research showing that Gen Zs1 are more likely to prefer human interaction in the recruitment process.


A survey of 1000 people who had secured a new job, with a new company, in the last 12 months, conducted by Reed Talent Solutions, found that the majority of Gen Zs (77%) felt frustrated with not being able to speak to someone directly during the recruitment process. In comparison, only 64% of Gen X and Boomers felt the same.


On top of this, the research also found that Gen Zs were much more likely to pull out from the recruitment process, with six in ten (60%) withdrawing an application early – with the most common reasons being the process was too slow (45%) and they would rather deal with a real person opposed to automation (37%).


In comparison, less than a half (46%) of the Gen X and Boomer generation have withdrawn their application early, with the top reasons being the process was too slow (51%) and that they weren’t fully aware of the job description and salary (31%); only 16% of this generation withdrew due to automation.


“Businesses need to reconsider how they use automation throughout their recruitment processes to attract the next generation of talent. We all assume the younger generation prefers technology and its convenience – but in reality, the human element is so important,” says Julie Hinchcliffe, Managing Director of Contingent Workforce Solutions at Reed Talent Solutions.


On top of this, when asked if they would prefer more or less automation during the recruitment process, less than a third of Gen Z (31%) and Gen X (24%) candidates wanted more automated processes, in comparison to nearly half (47%) of Boomers.


Julie continues: “Automation can help some recruitment processes, making it faster and easier for both the candidate and the employer. If done well, you won’t lose talent by implementing automation, but what is key, is ensuring the time it takes between encountering automation and hearing back from a person is kept to a minimum. The longer you leave it, the more disengaged the candidate will be.


“Those hiring also need to make sure candidates are given all the information they may desire throughout the process – from salary to the working environment – as without speaking to someone, if the information is not there, they are likely to be frustrated."


“In a market where attracting talent is more of a competitive sport than a walk in the park, businesses need to regularly assess and evaluate their recruitment processes to ensure they’re as inclusive as possible.”


When asked about the effectiveness of chatbots, Gen X and Boomers were the least impressed. Nearly half of Gen Zs (43%) stated chatbots were helpful, whereas only a quarter (25%) of the older generations agreed. The survey also found that different generations of workers preferred automation at different stages of the recruitment process. The Boomer generation were much more likely to prefer chatbots when trying to book an interview (51%), whereas only 29% of Gen Zs agreed.


The research also found some key trends that were quite consistent for all generations. For example, the majority of people would prefer to be told they have secured an interview for their job from someone directly, as opposed to via an automated response. The top reason for this was due to it being more personal and engaging, and because a real person can provide clarification and additional information.


“The survey brings some interesting differences to light that HR teams ought to consider. We found that Gen Z candidates are much more likely to want more human interaction during the interview stage, whereas Boomers prefer human assistance during the booking of interviews and tests, and during the reference and vetting process,” continues Julie.


“Knowing when to implement human interaction or chatbot assistance, can really change the recruitment experience for potential candidates. If candidates leave you feeling heard, valued and respected for their time in the application process, they are much more likely to want to accept a job offer, or even try for another job with you in the future if unsuccessful.”


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