ELFA confidence index rebounds in May as equipment finance outlook improves

The Equipment Leasing and Finance Association (ELFA) has reported a sharp improvement in industry confidence in May, with executives across the US equipment finance sector expressing growing optimism around business conditions, capital expenditure demand and the broader economic outlook.

According to ELFA’s latest Monthly Confidence Index (MCI), confidence in the equipment finance market rose to 59.9 in May 2026, up from 54.6 in April.

The index measures sentiment among senior executives operating across the $1.3 trillion US equipment finance industry and is viewed as a key indicator of market conditions and lending appetite.

The latest survey showed a notable increase in optimism around business conditions over the next four months. More than a quarter of executives (27.3%) said they expect conditions to improve, compared with just 11.8% in April, while the proportion expecting conditions to worsen fell sharply from 29.4% to 9.1%.

Expectations for capital expenditure demand also strengthened significantly. Around 26.1% of respondents believe demand for leases and loans to fund capex will increase over the coming months, more than doubling from April’s figure of 10.5%. None of the executives surveyed expect demand to decline.

Views on the wider US economy also improved, with 30.4% of respondents expecting economic conditions to improve over the next six months, compared with 15.8% in April. Meanwhile, the percentage expecting conditions to deteriorate fell from 36.8% to 21.7%.

Employment expectations remained relatively stable, although slightly more respondents expect headcount reductions compared with the previous month.

Industry executives taking part in the survey pointed to a complex operating environment shaped by geopolitical tensions, inflationary pressures and rising energy costs, while still expressing confidence in the resilience of the equipment finance sector.

David Normandin, President and CEO of Wintrust Specialty Finance, said the year had started strongly despite signs of stress among smaller businesses.

“The first quarter was a solid start to the year in terms of new business volume with reasonable yields. Small business appears to be stressed as illustrated by materially increased Chapter 11 bankruptcy filings year over year.”

Normandin added that slight increases in delinquency levels and credit losses among small businesses were likely to persist through much of 2026, although he still expects a strong overall year for the business.

Meanwhile, Jeffry Elliott, CEO of Elevex Capital, said economic disruption could create opportunities for equipment finance providers.

“Energy shock, inflation and recessionary fears will reduce capex spending, but raise yields as conservative lenders pull back from lending, leaving less competition for remaining required capex spending.

“The blockade of the Strait of Hormuz is having the effect of driving up fuel costs. The small and mid-sized businesses that don’t have the ability to pass along the higher costs are having the biggest challenge in managing their cash flow as a result.”