Asset finance new business grew by 7% in December 2024

New figures released by the Finance & Leasing Association (FLA) show that total asset finance new business (primarily leasing and hire purchase) grew in December 2024 by 7% compared with the same month in 2023.  In 2024 as a whole, new business was 3% higher than in 2023.

The commercial vehicle finance and plant and machinery finance sectors reported new business up in December by 14% and 4% respectively, compared with the same month in 2023. The business new car finance sector reported a fall in new business of 4% over the same period.

Commenting on the figures, Geraldine Kilkelly, Director of Research and Chief Economist at the FLA, said “The asset finance market ended the year on a positive note which meant in 2024 overall new business grew by 3% to reach a record level of £39.7 billion.

“Performances varied across the asset sectors last year. The commercial vehicle finance sector recorded the strongest growth of 10%. By contrast, the new car finance sector reported a significant slowdown in growth and the machinery and equipment finance sectors remained subdued.

“The industry continued to support investment by businesses of all sizes as new lending to SMEs grew by 1% to £23.5 billion, while new lending to larger businesses increased by 6% to £14.5 billion.

“The asset finance market supported the real economy by financing a third of UK investment in vehicles, machinery, and equipment in 2024. It is playing a key role in helping businesses to make the transition to net zero and we therefore urge the Government to ensure the recently announced green finance guarantee is fully funded, and leasing is included in the full expensing regime, in the Spring Spending Review.”