New figures released today by the Finance & Leasing Association (FLA) show that total asset finance new business (primarily leasing and hire purchase) fell by 10% in November 2020 compared with the same month in 2019. In the eleven months to November 2020, new business was 25% lower than in the same period in 2019.
The commercial vehicle finance and business car finance sectors reported falls in new business in November 2020 of 1% and 5% respectively, compared with the same month in 2019. The plant and machinery finance and IT equipment finance sectors reported falls in new business of 14% and 32% respectively, over the same period.
Commenting on the figures, Geraldine Kilkelly, Head of Research and Chief Economist at the FLA, said: “In November, the asset finance market recorded its smallest rate of contraction in new business since the start of the pandemic. This was despite increased restrictions across the UK to deal with rising cases of Covid-19, including a second national lockdown in England.
“UK-wide lockdowns during the first quarter of 2021 mean the near-term outlook remains challenging. The asset finance industry will continue to play a key role supporting business investment during 2021, as evidenced by almost £20 billion of new finance provided to businesses since the onset of the pandemic. This support helped to fund more than 38% of UK investment in machinery, equipment and purchased software in Q3 2020.”