UK & European Leasing & Asset           Finance Market Overview 
                                                                            

UK and European leasing markets remain resilient; recent data show stronger-than-expected monthly growth in UK asset finance and a stable European top‑50 portfolio at €349bn, while policy shifts (UK Autumn Budget) and ECB rate guidance are reshaping leasing economics.

 

United Kingdom Overview

 

Summary: The UK leasing and asset finance sector continues to support business investment, with mixed performance across asset classes and evolving policy headwinds.

Market size: FLA members delivered £80.3 billion in new lending in H1 2025, of which £20.23 billion supported business asset finance in the same period.

Asset class performance: Recent monthly FLA data show business new car finance and plant & machinery (equipment) both up ~11% year‑on‑year in September 2025, while commercial vehicle finance fell ~2% in the same month.

SME lending: Monthly figures for September 2025 show SME asset finance new business up 14% year‑on‑year, though longer‑run SME growth remains uneven and sensitive to credit conditions.

Industry confidence: The latest FLA Industry Outlook Survey (Q1 2025) reported 69% of respondents expecting some increase in new business over the next 12 months, reflecting cautious optimism amid macro uncertainty.

Policy & regulation: The UK Autumn Budget introduced motoring tax reforms (including an electric vehicle mileage levy announced for future years) that materially affect fleet economics and company car schemes, prompting lessors and fleet managers to reassess EV total cost of ownership and residual value assumptions. Lessors are also adapting to IAS lease accounting changes and preparing for Basel 3.1 capital impacts; FCA Consumer Duty and commission disclosure rulings continue to drive compliance work across the sector.

 

European Market Overview

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Summary: Europe’s top lessors show portfolio stability while consolidation and ESG trends accelerate product innovation.

Market size and structure: The AFE50 top 50 reported €349 billion in lease receivables (2024 data), up 2% on 2023, with the wider European market still estimated around €500 billion.

Regional highlights: France remains dominant within the AFE50 rankings; captives (OEM finance arms) continue to perform strongly in Germany; Southern Europe is showing momentum in SME leasing.

Interest rates and macro: The ECB’s policy easing through 2024–25 left key rates materially lower than 2023 peaks; the ECB’s operational rates were set at deposit facility 2.00% / main refinancing 2.15% in mid‑2025, which has supported demand for leasing as a flexible financing tool.

Sustainability, digital and strategic moves: ESG reporting mandates and circular‑economy policies are accelerating green leasing and lifecycle services. Major strategic consolidation continued with Groupe BPCE’s acquisition of Société Générale Equipment Finance, reshaping competitive positions among Europe’s largest players.

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