Credit Unions Lose Share of Auto Loans to Banks in Q3

Credit unions’ share of auto loans slipped in Q3 2025 as banks expanded their presence, but credit unions remain especially strong in used-vehicle financing and still hold over one-fifth of total auto finance market share. Banks now lead overall auto financing, with captives (manufacturer lenders) second and credit unions third.​

Key Q3 2025 findings

• Banks held about 28.9% of total automotive financing in Q3 2025, ahead of captives at 26.2% and credit unions at 21.1%.​

• For used vehicles, banks had roughly 29.7% share while credit unions were close behind at 28%, down slightly (about 0.8 percentage points) from a year earlier but up from Q2.​

• Credit unions’ overall auto loan share in Q3 dipped from a two-year peak of 16.8% in Q2, yet this was still their second‑strongest level since late 2023.​

Why banks gained share

• Banks have been actively broadening their “buy boxes,” including lowering minimum credit scores and extending more credit to near‑prime and subprime borrowers, which boosted their auto finance volume.​

• Some banks have formed new relationships with auto manufacturers and dealers, helping them recapture auto finance market share that had previously shifted toward captives and credit unions.​

• Experian data show banks leading the rebound in both new and used vehicle financing through 2025, continuing that momentum into Q3.​

Credit unions’ position

• Credit unions remain particularly competitive on used‑car loans, where they are only a little behind banks and well ahead of captives.​

• Their total auto finance share around 21% is lower than banks but still significantly higher than a few years ago, reflecting long‑term gains even with the recent quarterly dip.​

• Credit unions continue to attract borrowers with relatively favorable loan rates, though the current environment of easing rates and aggressive bank strategies has narrowed their advantage.​

Banks vs. credit unions snapshot