Total asset finance new business (primarily leasing and hire purchase) grew by 1% in February 2021 compared with the same month in 2020, according to new figures by the Finance & Leasing Association (FLA). 

The plant and machinery finance and commercial vehicle finance sectors reported new business up in February by 14% and 8% respectively, compared with the same month in 2020, the FLA said. 

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By contrast, the IT equipment finance and business equipment finance sectors reported falls in new business of 20% and 24% respectively, over the same period.

Geraldine Kilkelly, director of research and chief economist at the FLA, said: “In February, the asset finance market reported new business growth for the first time in more than a year. 

“FLA members reported growth in new finance for a range of assets including agricultural equipment, manufacturing equipment and printing equipment.

“While the FLA welcomes the measures announced in the Budget to ensure that a strong pick-up in business investment is part of the UK economic recovery, we urge the Government to extend the super-deduction allowance for expenditure on qualifying plant and machinery to include leasing. 

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“The asset finance industry has a proven track record in supporting businesses to invest in a wide range of machinery and equipment, with as much as 40% of this investment in the UK funded by FLA members.”

Car finance

The consumer car finance market reported a fall in new business volumes of 27% in February 2021, compared with the same month in 2020, the FLA said.
The consumer new car finance market reported a fall in new business volumes of 34% in February compared with the same month in 2020.
The percentage of private new car sales financed by FLA members in the twelve months to February 2021 was 92.8%, the trade body said.
The consumer used car finance market reported new business volumes 25% lower in February than in the same month in 2020.