A new report published by Allied Market Research suggests the Equipment Finance Services Market could hit more than $3.08 billion by 2032. According to the report- Equipment Finance Services Market by Type, Provider, and Application: Global Opportunity Analysis and Industry Forecast, 2022-2032 - the global equipment finance services market was valued at $1.2 trillion in 2022, and is projected to reach $3.1 trillion by 2032, growing at a CAGR of 9.7% from 2023 to 2032.
Prime determinants of growth
The equipment finance services market is driven by technological advancements such as AI, blockchain and IoT, which revolutionize the asset management and financing processes, thereby attracting both providers and consumers toward equipment finance solutions. Furthermore, evolving consumer preferences and demands for flexible financing options and value-added services drive the market growth.
However, regulatory compliance and economic uncertainties restrain the equipment finance services market growth. On the contrary, the growing trend towards sustainability and environmental consciousness to offer green financing solutions is raising the demand for eco-friendly equipment and practices. Moreover, partnerships and collaborations across industries enable equipment finance companies to leverage complementary expertise and resources, expanding their market reach and enhancing their service offerings to meet diverse customer needs in the upcoming years.
By type, the equipment loan segment held the highest market share in 2022, accounting for more than two-thirds of the global equipment finance services market revenue, and is estimated to maintain its leadership status throughout the forecast period. This is attributed to the increasing demand for modernized equipment across various industries, coupled with favorable financing terms and accessibility for businesses of all sizes.
Moreover, the need for flexible repayment options and the potential tax benefits associated with equipment loans further contribute to its expansion. However, the equipment lease segment is projected to manifest the highest CAGR of 12.3% from 2023 to 2032. This is attributed to the fact that it offers businesses the flexibility to acquire necessary equipment without a substantial upfront investment, preserving capital for other operational expenses or investments. Furthermore, leasing allows businesses to access the latest equipment technology without the burden of ownership, enabling them to remain competitive and adaptable to evolving industry standards and customer demands.
By region, North America held the highest market share in terms of revenue in 2022, accounting for more than one-third of the equipment finance services market revenue and is estimated to maintain its leadership status throughout the forecast period. This is attributed to the technological advancements that are driving the demand for updated equipment across various industries, necessitating flexible financing options to facilitate equipment acquisition in the region.