Asset finance market grew by 80% in April 2021

New figures released today by the Finance & Leasing Association (FLA) show that total asset finance new business (primarily leasing and hire purchase) grew by 80% in April 2021 compared with the same month in 2020. In the first four months of 2021, new business was 15% higher than in the same period in 2020.

The commercial vehicle finance sector reported new business up by 140% in April compared with the same month in 2020.  The plant and machinery and business equipment finance sectors reported new business up by 58% and 43% respectively, over the same period. By contrast, the IT equipment finance sector reported new business 13% lower in April than in the same month in 2020.

Commenting on the figures, Geraldine Kilkelly, Director of Research and Chief Economist at the FLA, said:

“The strong growth reported by the asset finance market in April was not unexpected given the adverse impact of the first lockdown on new business levels during the second quarter of last year. The latest figures show that the recovery in April was broad-based, with finance provided for investment in a wide range of vehicles, machinery and equipment. The fall in IT equipment finance new business reflected the relative strength of this sector at the start of the pandemic.

“If the industry maintains the performance we have seen in recent months, it would be on course to reach its pre-pandemic annual new business total by the end of 2021.  We urge the Government to recognize the importance of the asset finance market in supporting business investment and extend the super-deduction allowance for expenditure on qualifying plant and machinery to include leasing.”

Apr

 2021

% change on prev. year

3 months to

Apr 2021

% change on prev. year

12 months to

Apr 2021

% change on prev. year

Total FLA asset finance (£m)

2,918

80

8,377

26

28,712

-13

Total excluding high value (£m)

2,784

80

7,810

24

26,763

-12

 

Data Extracts:

 

By asset:

Plant and machinery finance (£m)

697

58

1,938

27

6,271

-8

Commercial vehicle finance (£m)

731

140

2,226

40

7,576

-8

IT equipment finance (£m)

131

-13

497

-18

2,314

-19

Business equipment finance (£m)

148

43

463

2

1,722

-21

Car finance (£m)

819

94

2,174

22

7,571

-16

Aircraft, ships and rolling stock finance (£m)

71

261

112

73

360

-32

 

By channel:

Direct finance (£m)

1,270

36

3,454

9

12,293

-19

Broker-introduced finance (£m)

626

128

1,828

41

5,905

-7

Sales finance (£m)

887

160

2,528

36

8,566

-4

 

By product:

Finance leasing (£m)

278

41

861

1

3,468

-13

Operating leasing (£m)

523

125

1,548

25

5,538

-14

Lease/Hire purchase (£m)

1,635

76

4,557

26

15,252

-14

Other finance (£m)

363

55

1,036

45

3,479

-1