Asset finance grows by 13%

13th July 2023

New figures released by the Finance & Leasing Association (FLA) show that total asset finance new business (primarily leasing and hire purchase) grew in May 2023 by 13% compared with the same month in 2022. In the five months to May 2023, new business was also 13% higher than in the same period in 2022.

The business new car finance and commercial vehicle finance sectors reported new business up in May by 60% and 7% respectively, compared with the same month in 2022. The plant and machinery finance sector reported a fall in new business of 10% over the same period.

Commenting on the figures, Geraldine Kilkelly, Director of Research and Chief Economist at the FLA, said “The asset finance market reported a thirteenth consecutive month of growth in May as the trends of higher average advances across asset finance sectors and strong performances by the vehicle finance sectors continued.  Lending to larger businesses was up by a third in May, and to SMEs grew by 4% in line with the previous month.”

“The industry is also cautiously optimistic about prospects for future growth, with the FLA’s Q2 2023 Industry Outlook Survey showing that almost three-quarters of asset finance respondents anticipate some increase in new business over the next year.”

May

 2023

% change on prev. year

3 months to

May

2023

% change on prev. year

12 months to

May 2023

% change on prev. year

Total FLA asset finance (£m)

3,090

13

10,148

13

35,638

11

Total excluding high value (£m)

2,924

13

9,616

17

33,934

14

Data Extracts:

 

By asset:

Plant and machinery finance (£m)

621

-10

2,156

2

7,946

6

Commercial vehicle finance (£m)

794

7

2,566

10

9,237

9

IT equipment finance (£m)

69

-26

291

-46

1,343

-17

Business equipment finance (£m)

143

-20

484

-10

1,893

-5

Car finance (£m)

1,039

36

3,396

40

11,021

28

Aircraft, ships and rolling stock finance (£m)

19

20

84

29

313

1

 

By channel:

Direct finance (£m)

1,337

23

4,306

27

15,357

23

Broker-introduced finance (£m)

693

9

2,234

14

7,933

15

Sales finance (£m)

894

3

3,077

9

10,644

4

 

By product:

Finance leasing (£m)

227

-13

817

-10

3,373

5

Operating leasing (£m)

703

49

2,265

47

7,438

24

Lease/Hire purchase (£m)

1,691

4

5,610

8

19,770

10

Other finance (£m)

330

22

1,041

6

3,764

6