Asset finance new business grows 2% in May

Asset finance new business grew by 2% in May 2026 compared with the same month last year, with lending to SMEs continuing to outperform and annual new business reaching a record £41.1 billion, according to the latest figures from the Finance & Leasing Association (FLA).

The FLA said total asset finance new business, primarily leasing and hire purchase, was 2% higher than in May 2025. Over the first five months of 2026, new business increased by 5% compared with the same period last year.

Growth was driven by several key sectors, with business new car finance and commercial vehicle finance both recording year-on-year growth of 7% in May. Plant and machinery finance also performed strongly, rising 9% over the same period.

SMEs continued to lead the market, with new asset finance lending to smaller businesses increasing by 7% in May, marking the ninth consecutive month of growth. By contrast, new lending to larger businesses fell by 6%.

“While growth was more modest than in recent months, new business remained robust in core sectors including plant and machinery and commercial vehicle finance. SME lending also recorded a ninth consecutive month of growth, underlining the sector’s vital role in helping businesses invest, grow and improve productivity.”

Looking ahead, Kilkelly said economic conditions were likely to temper the pace of growth despite continued investment demand.

“The economic environment remains challenging. Although UK GDP returned to growth in May, recent surveys suggest business activity and confidence has softened. We expect the asset finance market to remain resilient, supported by firms’ ongoing investment needs, but growth is likely to remain measured while businesses contend with weaker demand, elevated borrowing costs and continued geopolitical uncertainty.”

	May  2026	% change on prev. year	3 months to May 2026	% change on prev. year	12 months to May 2026	% change on prev. year
Total FLA asset finance (£m)	3,198	2	11,395	8	41,106	5
Total excluding high value (£m)	3,084	3	10,964	8	39,133	5
Data extracts: By asset:
Plant and machinery finance (£m)	702	9	2,535	20	8,419	11
Commercial vehicle finance (£m)	908	7	3,074	7	10,894	-1
IT equipment finance (£m)	84	-1	298	-1	1,278	2
Business equipment finance (£m)	132	-3	431	-12	1,764	1
Car finance (£m)	1,100	9	4,030	13	13,761	6
Aircraft, ships and rolling stock finance (£m)	21	-79	84	-41	348	-10
By channel:
Direct finance (£m)	1,405	1	4,944	10	17,865	6
Broker-introduced finance (£m)	699	2	2,350	4	8,921	6
Sales finance (£m)	979	5	3,670	7	12,347	1
By product:
Finance leasing (£m)	228	3	854	18	3,161	4
Operating leasing (£m)	739	3	2,599	4	10,139	2
Lease/Hire purchase (£m)	1,765	3	6,356	10	21,162	3
Other finance (£m)	413	-3	1,415	9	5,401	25