Asset finance is growing, but are older business owners being left behind?

Alex Read, CEO of Portman Finance Group, explores why older business owners are struggling to navigate an increasingly complex finance market, and how asset finance providers can bridge the confidence gap through a more consultative, relationship-led approach.

The UK’s asset finance industry plays a vital role in supporting business investment. According to the Finance & Leasing Association (FLA), new asset finance lending to SMEs reached a record £25.6 billion in the 12 months to July 2026, helping businesses invest in the vehicles, machinery, and equipment needed to sustain and grow. Yet while the availability and range of financing options continues to expand, not all business owners feel confident navigating the market.

Our recent research reveals a stark generational divide, with almost three-quarters (74%) of business owners aged 55 and over saying that the business finance market is confusing, compared with just 45% of those aged 25-34. This is particularly concerning because older business owners are not lacking ambition or appetite for investment. In fact, 78% of over-55s say they need external finance to grow their business, but 47% report having already missed a growth opportunity because they lacked sufficient funding.

For the asset finance industry, these findings raise an important question: are we doing enough to help some of our most experienced business owners access the capital they need?

A changing finance landscape

The finance market that today’s experienced business owners are navigating looks very different from the one many encountered earlier in their careers. The traditional relationship between business owners and their local bank manager has steadily diminished. In its place, a much broader funding landscape has emerged, with high-street banks competing alongside challenger banks, specialist lenders, brokers, and digital platforms.

The scale of this shift is significant, and visible, as according to the British Business Bank’s 2026 Small Business Finance Markets report, challenger and specialist banks accounted for 60% of gross SME bank lending in 2025, up from 39% in 2012.

Greater competition should be welcomed, particularly as it gives businesses access to a wider range of financial products and potentially more flexible funding structures. However, more choice does not automatically translate into better understanding. The same British Business Bank research found that just 34% of smaller businesses considered more than one finance provider the last time they sought finance in 2025, down from 38% the previous year.

While there will be various reasons behind this, it raises questions about how effectively businesses are navigating the options available to them.

For an experienced business owner accustomed to working with a longstanding banking relationship, the breadth of today’s market can be difficult to assess. Even those who understand their industry inside out may struggle to compare different eligibility requirements and repayment structures. For asset finance providers, this presents an opportunity to rethink how we engage with customers.

Consider a manufacturing business looking to replace ageing machinery. Its owner may have spent decades in the industry and understand precisely how that investment could improve productivity, but still be uncertain whether purchase, leasing, or a traditional business loan is the most appropriate financing route. Each option carries different implications for ownership, repayment flexibility, cashflow, and longer-term financial commitments, and a lender focused solely on providing the quickest approval or most competitive headline rate risks overlooking these wider commercial considerations.

Instead, the starting point should be understanding what the business is trying to achieve. This is where brokers and lenders can add genuine value, combining technical product knowledge with an understanding of the commercial realities facing individual businesses.

The continued importance of human relationships

Interestingly, our research suggests older business owners particularly value this guidance. Almost three-quarters (74%) of over-55s say they rely on a finance provider to help select a product suited to their circumstances, compared with around 60% of those aged between 25 and 44.

Don’t mistake this for a lack of financial know-how. Rather, it highlights the importance of professional judgement when making decisions that can have significant implications for a business.

At the same time, the industry is increasingly focused on digitalisation. Online applications and AI-powered tools are transforming how finance is originated and delivered. These innovations bring clear benefits as streamlined applications can reduce administrative burdens, while better use of data can support faster and more informed credit decisions. But, a faster application does not mean a customer has a better understanding of the finance they are taking on.

Technology should complement, rather than replace, the expertise of relationship managers and finance professionals.

Closing the confidence gap

For lenders and brokers, addressing this confidence gap requires taking a genuinely consultative approach – explaining the advantages and trade-offs of different financing structures, being transparent about costs and eligibility, and ensuring repayment obligations align with the commercial objectives of the customer.

Sometimes, the right path may even mean recommending that a business delays investment or explores an alternative funding route.

Ultimately, this is not about encouraging older business owners to borrow more, but ensuring that those who have the ambition, and commercial rationale, to invest are not discouraged by a market they find unnecessarily difficult to navigate.