THE DIFFICULTY of obtaining credit is driving firms to lease equipment they need, according to figures seen by City A.M.
The use of asset finance to procure IT hardware and software soared 26 per cent during the year to September 2012, data from Syscap revealed, hitting £1.34bn, up from £1.07bn in the same period a year earlier. This is over and above the three per cent rise in overall asset financing, the figures from the IT specialist lender show.
In the same period Bank of England figures showed lending to private non-financial corporations 2.8 per cent down – highlighting the difficult funding climate for UK businesses.
“Businesses have under-invested in IT equipment because of uncertainty in the economy and because bank funding for IT investment has been so hard to secure,” said Syscap chief executive Philip White. However he warned that even the meteoric rise in leasing could be erased by further falls in traditional lending sources – given the existing size differences.
This comes as the UK economy enters the sixth month of the Bank of England and HM Treasury’s Funding for Lending Scheme, designed to boost the amount of credit offered by banks.