Equipment finance continues to grow

New business volume grew 6.9% in the equipment finance industry in 2017, according to the 2018 Survey of Equipment Finance Activity (SEFA) released by the Equipment Leasing and Finance Association (ELFA).

The rise in new business volume marked the eighth consecutive year that businesses increased their spending on capital equipment.

ELFA president and CEO Ralph Petta says: "The equipment finance industry continues to grow and prosper, as evidenced by this latest edition of ELFA's Survey of Equipment Finance Activity."

The survey found that new business volume grew 6.9% in 2017, surpassing real GDP, which grew 2.3%. By market segment, new business volume grew 9.7% in the middle-ticket segment, 4.3% in the small-ticket and 2.8% in the large-ticket market.

The top five end-user industries representing the largest share of new business volume were services, agriculture, wholesale/retail, industrial and manufacturing, and transportation.

The report notes that delinquencies increased slightly, with 2.0% of receivables over 31 days past due compared to 1.8% the previous year. While delinquencies are still very low, they have been on the rise since 2013 when only 1.2% of receivables were over 31 days past due.

In a separate report, ELFA also found that new business volume in the small-ticket space grew by 3.6% in 2017.

The Equipment Leasing and Finance Association (ELFA) is the trade association that represents companies in the USD1 trillion equipment finance sector, which includes financial services companies and manufacturers engaged in financing capital goods.