New figures released by the Finance & Leasing Association (FLA) show that asset finance new business (primarily leasing and hire purchase) grew by 5% in 2017 – the seventh consecutive year of growth. New business in December 2017 increased by 4% compared with the same month in 2016.

The plant and machinery finance and commercial vehicle finance sectors reported new business up in 2017 by 12% and 1% respectively, compared with 2016, while new finance for business equipment was up by 7% over the same period.

Commenting on the figures, Geraldine Kilkelly, Head of Research and Chief Economist at the FLA, said “The asset finance industry reported a record level of new business of almost £32 billion in 2017, despite challenging economic conditions and subdued business investment growth. The latest figures also reveal that asset finance is a vital source of funding for SMEs when investing in business equipment and machinery. Of the total asset finance new business in 2017, £18.6 billion went to SMEs – 12% higher than in 2016.”

Dec 2017 % change on prev. year 3 months to Dec

2017

% change on prev. year 12 months to Dec

2017

% change on prev. year
Total FLA asset finance (£m) 2,632 +4 7,861 +5 31,769 +5
Total excluding high value (£m) 2,483 -1 7,695 +5 30,752 +6
Data Extracts:

 

By asset:

Plant and machinery finance (£m) 512 +1 1,515 +5 6,617 +12
Commercial vehicle finance (£m) 572 -14 1,934 -1 7,480 +1
IT equipment finance (£m) 293 +19 726 +14 2,285 +2
Business equipment finance (£m) 227 +6 624 +6 2,581 +7
Car finance (£m) 629 -2 2,243 +4 9,531 +5
Aircraft, ships and rolling stock finance (£m) 36 -41 60 -50 549 +20
 

By channel:

Direct finance (£m) 1,153 -7 3,746 0 15,477 +4
Broker-introduced finance (£m) 579 +24 1,620 +21 5,839 +14
Sales finance (£m) 752 -8 2,329 +4 9,436 +7
 

By product:

Finance leasing (£m) 403 +1 1,022 +5 3,809 +6
Operating leasing (£m) 511 -12 1,624 -4 6,755 0
Lease/Hire purchase (£m) 1,225 +1 4,162 +5 16,924 +8
Other finance (£m) 493 +45 1,053 +19 4,281 +5