New figures released today by the Finance & Leasing Association (FLA) show that total asset finance new business (primarily leasing and hire purchase) fell by 6% in January 2025 compared with the same month in 2025. In the twelve months to January 2026, new business was 1% higher than in the same period in 2025.
The business equipment finance and plant and machinery finance sectors reported growth in new business in January of 2% and 13% respectively, compared with the same month in 2025. The commercial vehicle finance sector reported a 15% fall in new business over the same period.
New asset finance lending to SMEs grew by 3% in January compared with the same month in 2025, while new lending to larger businesses fell by 19% over the same period.
Commenting on the figures, Geraldine Kilkelly, Director of Research and Chief Economist at the FLA, said:
“The asset finance market saw further growth in new lending to SMEs at the start of 2026, extending the momentum built in the second half of last year, even as conditions across the wider market remained more subdued.
“But the economic outlook has clearly toughened for businesses. Geopolitical tensions are keeping inflationary pressures elevated and delaying the prospect of lower interest rates, and many firms are holding back on major investment decisions as uncertainty persists.
“Businesses are prioritising resilience over expansion, and a meaningful recovery in investment will depend on clearer signals on inflation, interest rates and the broader economic outlook.”
