New Business Volume Rose in July
Year to date, 2014 appears to be a good year for equipment leasing. A recent report from the Equipment Leasing and Finance Association revealed that new business volume for equipment leasing was up for the year, indicating that the economy is continuing to recover from the recession at a steady pace.
ELFA’s Monthly Leasing and Finance Index showed that new business volume in July was up 8 percent from the same month a year ago, reaching a total of $7.8 billion. However, compared to the previous month, new business volume was down 13 percent. The report concluded that this month-to-month drop was not entirely a surprise, as new business volume is typically lower in July and August. What is a more important mark of new business volume is the year-to-date figure, which was up 4 percent in the most recent report.
“After a solid second quarter that saw an overall increase in U.S. GDP and strong business investment, new business volume in the equipment finance sector continued to hold steady in July,” said William Sutton, president and CEO of ELFA. “Credit performance is mixed: monthly delinquencies were up (as a result of a single respondent-outlier) but charge-offs remained at historically low levels. For now, most ELFA member companies report good, if not spectacular, growth, and conditions appear favorable for this to continue into the late summer and early fall.”
Following the recession, businesses have had a harder time getting working capital from traditional sources, which has led to an uptick in alternative lenders, such as National Funding. Small business loans for working capital can be a great way to finance a business. According to ELFA’s report, credit approvals in July reached 79.1 percent. This is a slight drop from the previous two month’s figure of 80.1 percent.