UK asset finance grows 10% in August, boosted by plant and machinery

UK asset finance new business increased by 10% in August 2026 compared with the same month last year, reaching £2.97bn, according to the latest figures from the Finance & Leasing Association (FLA).

The increase marked the seventh consecutive month of growth for the sector, with performance boosted by high-value transactions, particularly in plant and machinery finance.

In the first eight months of 2026, asset finance new business was 6% higher than in the corresponding period of 2025, while total new business in the 12 months to August reached £41.93bn, also up 6% year-on-year.

However, excluding high-value transactions, August’s growth was more modest at 2%, with new business totalling £2.66bn.

Plant and machinery finance leads growth

Plant and machinery finance recorded the strongest performance among the main asset categories, with new business increasing by 30% year-on-year to £747m in August.

The sector also reported growth of 18% in the three months to August and 16% over the latest 12-month period.

Commercial vehicle finance grew by 10% in August to £756m, while business car finance increased by 6% to £914m.

By contrast, IT equipment finance declined by 8% to £95m, while business equipment finance fell by 15% to £129m.

The aircraft, ships and rolling stock finance sector also recorded a decline, with new business down 27% to £23m.

SME asset finance lending increases 11%

New asset finance lending to SMEs grew by 11% in August compared with the same month in 2025, while lending to larger businesses increased by 9%.

Across distribution channels, broker-introduced finance increased by 4% to £646m, while sales finance grew by 7% to £854m.

Direct finance declined by 2% to £1.16bn, despite recording growth of 8% over the latest 12-month period.

By product, lease and hire purchase new business increased by 5% to £1.41bn, while finance leasing grew by 2% to £244m.

Operating leasing declined slightly, falling by 1% to £698m. Other finance products recorded growth of 69% to £551m, contributing to the overall increase in new business.

FLA calls for investment incentives ahead of Budget

“Asset finance new business grew by 10% in August, with growth boosted by high-value transactions, predominantly in the plant and machinery finance sector. As a result, the market recorded a seventh consecutive month of growth.

“Asset finance plays a vital role in supporting business investment, enabling firms of all sizes to acquire the vehicles, equipment and technology needed to improve efficiency, expand capacity and grow.”

With the Autumn Budget taking place on 28 October, Kilkelly highlighted research from The Productivity Institute calling for measures to encourage productive business investment.

“The latest research from The Productivity Institute suggests the UK could do more to encourage productive investment by removing barriers that increase its cost. Ahead of this week’s Autumn Budget, it has called for new plant, machinery and productivity-enhancing improvements to be excluded from business rates calculations and for improvement relief to be made permanent.

“Such measures could strengthen incentives to invest, with asset finance helping businesses translate those opportunities into higher productivity, stronger competitiveness and sustainable growth.”

	Aug  2026	% change on prev. year	3 months to Aug 2026	% change on prev. year	12 months to Aug 2026	% change on prev. year
Total FLA asset finance (£m)	2,965	10	10,344	9	41,934	6
Total excluding high value (£m)	2,662	2	9,807	8	39,832	6
Data extracts: By asset:
Plant and machinery finance (£m)	747	30	2,311	18	8,772	16
Commercial vehicle finance (£m)	756	10	2,852	15	11,263	4
IT equipment finance (£m)	95	-8	311	3	1,287	3
Business equipment finance (£m)	129	-15	429	-8	1,723	-3
Car finance (£m)	914	6	3,441	10	14,066	7
Aircraft, ships and rolling stock finance (£m)	23	-27	70	-26	324	-18
By channel:
Direct finance (£m)	1,162	-2	4,447	11	18,334	8
Broker-introduced finance (£m)	646	4	2,180	1	8,895	6
Sales finance (£m)	854	7	3,180	9	12,604	3
By product:
Finance leasing (£m)	244	2	743	1	3,164	7
Operating leasing (£m)	698	-1	2,435	-1	10,120	2
Lease/Hire purchase (£m)	1,412	5	5,474	13	21,789	6
Other finance (£m)	551	69	1,494	32	5,767	29