Finance & Leasing Association11 March 2022
New figures released today by the Finance & Leasing Association (FLA) show that total asset finance new business (primarily leasing and hire purchase) grew in January 2022 by 11% compared with the same month in 2021. In the twelve months to January 2022, new business grew by 16% compared with the same period in 2021.
The commercial vehicle finance sector reported new business up by 12% in January compared with the same month in 2021. The plant and machinery finance and business equipment finance sectors reported new business growth of 9% and 7% respectively, over the same period.
Commenting on the figures, Geraldine Kilkelly, Director of Research and Chief Economist at the FLA, said:
“The strong performance of the asset finance market in January in part reflects the restrictions in place during the third UK lockdown last year. Nevertheless, new business reported this January has recovered to more normal levels and in line with that reported for January in the five years prior to the pandemic.
“The economic outlook in the UK and globally has weakened following the invasion of Ukraine. However, we continue to expect a rebound in business investment during 2022 following several years of underperformance. The asset finance industry will play a key role in supporting SMEs and larger businesses to invest in new technologies that will improve productivity and help meet net zero targets. We therefore urge the Government to extend the super-deduction allowance for expenditure on qualifying plant and machinery to include leasing so the industry can support more businesses to recover and grow.”
| Jan 2022 |
% change on prev. year |
3 months to Jan 2022 |
% change on prev. year |
12 months to Jan 2022 |
% change on prev. year |
|
| Total FLA asset finance (£m) |
2,402 |
11 |
7,636 |
4 |
31,546 |
16 |
| Total excluding high value (£m) |
2,121 |
9 |
6,986 |
3 |
29,433 |
16 |
|
|
|
|
|
|
|
|
| Data Extracts:
By asset: |
|
|
|
|
|
|
| Plant and machinery finance (£m) |
515 |
9 |
1,765 |
22 |
7,380 |
25 |
| Commercial vehicle finance (£m) |
621 |
12 |
2,040 |
4 |
8,449 |
22 |
| IT equipment finance (£m) |
82 |
-49 |
302 |
-51 |
1,615 |
-33 |
| Business equipment finance (£m) |
121 |
7 |
476 |
6 |
1,896 |
10 |
| Car finance (£m) |
641 |
7 |
2,052 |
1 |
8,546 |
18 |
| Aircraft, ships and rolling stock finance (£m) |
87 |
121 |
108 |
56 |
384 |
23 |
|
By channel: |
|
|
|
|
|
|
| Direct finance (£m) |
935 |
4 |
2,937 |
-8 |
12,604 |
5 |
| Broker-introduced finance (£m) |
472 |
10 |
1,586 |
8 |
6,690 |
24 |
| Sales finance (£m) |
714 |
15 |
2,462 |
15 |
10,139 |
27 |
|
By product: |
|
|
|
|
|
|
| Finance leasing (£m) |
217 |
-13 |
761 |
-11 |
3,187 |
-8 |
| Operating leasing (£m) |
399 |
-11 |
1,475 |
-4 |
6,169 |
18 |
| Lease/Hire purchase (£m) |
1,340 |
14 |
4,192 |
8 |
17,413 |
21 |
| Other finance (£m) |
362 |
54 |
887 |
20 |
3,449 |
7 |
Note to editors:
- In 2021, FLA members provided £132 billion of new finance to UK businesses and households. £31 billion of finance was provided to businesses and the public sector. FLA members financed more than a third of UK investment in machinery, equipment and purchased software in the UK in 2021.
- At the 2021 Budget, the Chancellor of the Exchequer announced a “super-deduction” for expenditure on qualifying plant and machinery assets. The measure hopes to boost investment by providing an allowance of 130% on new plant and machinery investments that would normally qualify for 18% main rate writing down allowance. The legislation as currently drafted excludes some of the most common ways plant and machinery is used by businesses, including leasing and plant hire. We propose that changes are made to the deduction so that it benefits a much broader range of businesses. The FLA and BVRLA joint briefing paper on Super Deduction can be found here.
- For media enquiries, please contact the FLA press office on 020 7420 9656.
