Asset finance new business grew by 20% in February 2023

New figures released by the Finance & Leasing Association (FLA) show that total asset finance new business (primarily leasing and hire purchase) grew in February 2023 by 20% compared with the same month in 2022. In the first two months of 2023, new business was 13% higher than in the same period in 2022.

The business new car and commercial vehicle finance sectors reported new business up in February by 46% and 24% respectively, compared with the same month in 2022. The plant and machinery finance sector also reported new business growth of 18% 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 tenth consecutive month of new business growth in February which was more broad-based than in recent months, albeit compared with a relatively subdued February 2022. Asset finance new business provided to SMEs and larger businesses increased in February by 16% and 28% respectively.

“The latest figures clearly demonstrate that the industry is continuing to support businesses to invest and grow in a challenging economic environment. Among SMEs, the success rate is high when applying for asset finance, with 95% offered a facility. Furthermore, 93% of SMEs applying for asset finance were satisfied with the outcome of the process compared with only 54% of those applying for a bank loan.”

	Feb 2023	% change on prev yr	3 mths to Feb 2023	% change on prev yr	12 mths to Feb 2023	% change on prev yr
Total FLA asset finance (£m)	2,609	20	8,458	15	34,457	8
Total excluding high value (£m)	2,430	17	8,032	18	32,513	9
Data Extracts:
By asset:
Plant and machinery finance (£m)	654	18	1,836	7	7,896	7
Commercial vehicle finance (£m)	734	24	2,153	13	8,997	7
IT equipment finance (£m)	99	19	363	16	1,588	3
Business equipment finance (£m)	144	-5	442	-10	1,946	1
Car finance (£m)	715	26	2,713	38	10,059	16
Aircraft, ships and rolling stock finance (£m)	11	-59	78	-38	294	-25
By channel:
Direct finance (£m)	1,099	26	3,826	32	14,450	13
Broker-introduced finance (£m)	604	16	1.831	16	7,664	12
Sales finance (£m)	727	6	2,374	2	10,399	0
By product:
Finance leasing (£m)	242	10	863	16	3,464	9
Operating leasing (£m)	556	45	1,956	42	6,714	9
Lease/Hire purchase (£m)	1,435	14	4,432	11	19,350	10
Other finance (£m)	287	15	950	-4	3,709	1