New figures released today by the Finance & Leasing Association (FLA) show that total asset finance new business (primarily leasing and hire purchase) fell by 47% in April 2020 compared with the same month in 2019. In the four months to April 2020, new business fell by 23% compared with the same period in 2019.
The vehicle finance sectors reported the largest falls in April as new business in the commercial vehicle finance and business new car finance sectors contracted by 65% and 71% respectively, compared with April 2019. Over the same period, the IT equipment finance and plant and machinery finance sectors reported falls in new business of 18% and 30% respectively.
Commenting on the figures, Geraldine Kilkelly, Head of Research and Chief Economist at the FLA, said: “The asset finance market continued to support businesses during the lockdown, fulfilling pipeline deals and demand from those sectors less affected by the lockdown measures such as agriculture and some manufacturing sectors.
“FLA asset finance members have a strong track record of supporting businesses through difficult times. To ensure that the industry can continue to do so, the Government needs to take immediate action to support all lenders, including non-bank lenders, by allowing them to access the Term Funding Scheme as the FLA has suggested in its Term Funding Pipeline proposal. This would allow the whole of the asset finance industry to support the huge demand for forbearance and meet demand for new finance as the economy reopens.”