Vehicle Finance was the most popular type of asset finance throughout the last financial year. Why did we see growth in this sector of asset finance?

As the 2020/21 financial year has now ended, everyone in the finance space is looking back at the trends that were seen throughout the year. It will be obvious to most that the pandemic will have a large impact on the types of trends seen, and the success of businesses. With the Australian economy put into recession for the first time in almost 30 years during the 20/21 financial year, there was no doubt that this would have an impact.

When looking at business finance trends it was reported that in some sectors, despite the economic uncertainty, asset finance loans grew by 20%. Commonwealth Bank Australia has released a report that suggests in the middle of the pandemic, some industries were flourishing hugely, so as a result new asset purchases and lending grew.

This included the most established sector of asset finance, vehicle finance. Vehicle finance has long been one of the most established sectors of asset finance, and not even the pandemic could take away its standing as the most popular type of asset finance.

So, why did we still see an increase in vehicle finance despite the tough economic conditions? While operating conditions haven’t been the brightest in the past 12 months, sectors such as agriculture and manufacturing have been booming and have needed to expand their fleets or upgrade their vehicles, in order to take advantage of technological enhancements, or new designs. Hence the increase we have seen in vehicle finance.

Vehicle finance is also an extremely popular option for small and medium-sized businesses because it allows them to keep their business moving and growing, without the need to use a large chunk of the businesses necessary cashflow at once.  To many experts, the growth of vehicle finance isn’t unexpected, and the necessity of this type of finance was shown during the 2020/21 financial year.

So, is vehicle finance a good option for your small or medium-sized business? This will depend both on the type of business you run, and the financial stability of your business. It will also depend on your ability to find the right lender and get the right vehicle finance that suits your situation.

Luckily for SMEs in Australia, if you have been in business for over a year, non-bank lenders are available to offer you vehicle finance. Often bank lenders can make getting asset finance really difficult for small and medium-sized businesses, which is why non-bank lenders offer simpler, faster and easily available finance options for SMEs.

Australian non-bank lender Grow Finance offers a range of flexible funding solutions for your next vehicle. Grow Finance offers finance options either as operating leases, rental or chattel mortgage, to allow their clients to purchase a range of assets. Whether you are looking for a new or replacement vehicle to operate or grow your business, Grow Finance has a vehicle finance solution for you.

To find out more, talk to the Grow Finance team today, call 1300 001 420, or if you are ready to move forward, then apply now.