Employees who have taken cash allowances will find it more difficult to source personal leasing for cars next year, according to the boss at one top 20 leasing company.

Neal Francis, Pendragon Contracts divisional director, said there has been a big uplift in the number of staff opting out of company car schemes but he believes asset lenders will be less willing to lend money in the future.

“It’s questionable how asset lenders will want to support these,” he said. “The market has changed significantly. Asset lenders are in an adverse situation where government said sort out your balance sheet and be more responsible.”

In the short-term Francis predicts growth in salary sacrifice schemes as employees find it easier to get funding underwritten via the company. This will help companies regain control over grey fleets from both a health and safety perspective and environment focus.

Pendragon anticipates more interest in its own salary sacrifice scheme as a result and already reports a significant rise in enquiries. Francis says it is a more tax efficient way of putting vehicles onto fleets as long as the company chooses the right cars.

“It is giving us an opportunity to extend our audience because some fleets are expanding as they offer cars as an employee benefit to open up further value for their staff,” he said.

“For the employer, as long as they pick the right cars, it saves them money on National Insurance. But they have to target cheaper cars with lower CO2 emissions.”