The Equipment Leasing and Finance Association recently released its monthly CapEx Finance Index for January 2025. The report showed that total new business volume (NBV) rose by $9.3 billion seasonally adjusted but saw a significant decline of 17.8% from December to January among ELFA member companies. Year-to-date, NBV contracted by 6.4% from 2023 to 2024 on a seasonally adjusted basis, with a year-over-year decline of 10.6% on a non-seasonally adjusted basis. Charge-offs decreased to 0.46%, marking the second consecutive month of decline.
The drop in NBV growth was notable, experiencing its largest one-month decline on record, with a 17.8% fall from December to January. Despite this sharp percentage drop, the dollar amount of new business was the lowest since March 2023. Banks and captives saw a monthly decrease of over 30% in new activity, while financing at independents increased by nearly 9%. Overall, the dollar amount of new business remained above the monthly average from January to November 2024, although new activity at captives reached its lowest level since January 2017.
“Despite macro-economic and political uncertainty, we anticipate companies will still look for creative financing solutions,” said Mitch Rice, CEO of Commercial Capital Company. “They’re seeking greater flexibility and simplified, frictionless processes to address their evolving needs. Recognizing this demand, the industry is undergoing a widespread focus on technological enhancement to deliver more efficient and effective solutions and services. We’re embracing this shift when it comes to process automation and utilizing artificial intelligence.”
Click here to read the full CFI report with additional data on aging of receivables, average losses, credit approval ratios and change in headcount.