Asset finance in the UK is showing signs of robust growth, particularly in the realms of leasing and hire purchase, according to the Finance & Leasing Association. 

The FLA’s latest figures demonstrate a noteworthy 11% surge in total asset finance new business for October 2023 in comparison to the corresponding month in 2022. 

This positive momentum extends over the ten months leading up to October 2023, marking a substantial 14% increase compared to the same interval in the prior year.

Breaking down the data, the business new car finance sector experienced an impressive 53% uptick in new business in October 2023 versus the same month in 2022. 

Similarly, the commercial vehicle finance sector reported an 8% surge during the same period. However, the plant and machinery finance sector bucked the trend, recording a decline of 17% in new business over the specified time frame.

Geraldine Kilkelly, the FLA's Director of Research and Chief Economist, said: “The asset finance market returned to double-digit new business growth in October with further strong performances from the vehicle finance sectors. New asset finance lending to SMEs grew by 6% compared with the same month in 2022, while to larger businesses it increased by 15%.

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“2023 is set to be a record year for the asset finance industry as new business is expected to reach more than £38 billion. The industry directly supports the real economy by providing finance to businesses of all sizes which funds as much as 40% of UK investment in machinery, equipment and vehicles. Asset finance is playing a vital role in funding the investment needed to raise productivity while helping the UK transition to net zero which will ultimately raise economic growth and household living standards.”