New figures released today by the Finance & Leasing Association (FLA) show that total asset finance new business (primarily leasing and hire purchase) grew in October 2022 by 17% compared with the same month in 2021. In the ten months to October 2022, new business was 5% higher than in the same period in 2021.
The plant and machinery finance sector reported new business up in October by 23% compared with the same month in 2021. Over the same period, business equipment finance and commercial vehicle finance new business grew by 13% and 11% respectively.
Commenting on the figures, Geraldine Kilkelly, Director of Research and Chief Economist at the FLA, said: “In October, the asset finance market reported its strongest rate of new business growth since June 2021, with new lending to SMEs increasing at a double-digit rate. We expect asset finance new business to reach £32.5 billion in 2022 as a whole, 4% higher than in 2021, but 9% lower than in 2019 which largely reflects the shortages of asset to finance.
“Despite the challenging outlook for demand over the next year, businesses are committed to investing in energy-efficient equipment and machinery. Demand for finance to support business-critical investment combined with the gradual easing of supply shortages should support asset finance new business volumes over the next twelve months.”
| Oct 2022 | % change on prev. year | 3 months to Oct 2022 | % change on prev. year | 12 months to Oct 2022 | % change on prev. year | |
|---|---|---|---|---|---|---|
| Total FLA asset finance (£m) | 2,887 | 17 | 8,415 | 12 | 32,545 | 4 |
| Total excluding high value (£m) | 2,778 | 21 | 8,054 | 14 | 30,376 | 4 |
| Data Extracts: | ||||||
| By asset: | ||||||
| Plant and machinery finance (£m) | 658 | 23 | 1,958 | 14 | 7,743 | 10 |
| Commercial vehicle finance (£m) | 776 | 11 | 2,191 | 8 | 8,651 | 3 |
| IT equipment finance (£m) | 76 | -29 | 389 | -6 | 1,501 | -22 |
| Business equipment finance (£m) | 157 | 13 | 490 | 1 | 1,961 | 5 |
| Car finance (£m) | 882 | 31 | 2,422 | 17 | 8,999 | 6 |
|
Aircraft, ships and rolling stock finance (£m) |
10 | -57 | 67 | -13 | 312 | -10 |
| By channel: | ||||||
| Direct finance (£m) | 1,322 | 37 | 3,573 | 17 | 13,016 | 1 |
| Broker-introduced finance (£m) | 642 | 16 | 1,943 | 18 | 7,174 | 10 |
| Sales finance (£m) | 825 | 4 | 2,539 | 7 | 10,186 | 3 |
| By product: | ||||||
| Finance leasing (£m) | 298 | 7 | 884 | 16 | 3,276 | 0 |
| Operating leasing (£m) | 592 | 30 | 1,656 | 8 | 5,992 | -4 |
|
Lease/Hire purchase (£m) |
1,625 | 19 | 4,732 | 14 | 18,612 | 9 |
| Other finance (£m) | 295 | 24 | 839 | 17 | 3,395 | 3 |
