Demand for asset finance in the UK reached record levels in 2017 and this has led to calls for the government to support the sector’s growth in 2018.
According to data released by UK Finance, asset based lending has increased by 4% in the UK to £214 billion. The figure was based on the first three quarters of 2017 and the final figure is set to be even higher that what is already a record. The value of total advances in the most recent quarter totalled £22 billion which marked a 13% year on year increase.
The export sector saw particularly strong growth with export invoice discounting facilities up 33% and export factoring up 11% in Q3 2017. This will undoubtedly have helped the UK export sector deal with increased demand as a result of the fall in the value of sterling.
The figures show the increasing appetite for asset finance among UK businesses many of which are still unaware of the benefits. Asset finance can help support growth and expansion by using existing assets freeing up vital cashflow without having to resort to bank lending.
The only difficulty is in unlocking the same benefits for smaller businesses. This requires the government to bring forward legislation to remove some of the hurdles faced.