Polish Leasing Industry Surpasses Forecasts with Strong H1

• Leasing companies granted financing worth 54.2 billion PLN in the first six months of 2024
• This is an increase of 13.5% compared to the first six months of 2023
• The leasing industry’s results for the first half of 2024 are in line with forecasts
• According to estimates, the market will grow by more than 12% to over 115 billion PLN in 2024

The leasing industry counts the first half of this year as a success. It financed movable and real estate assets worth a total of 54.2 billion PLN. This value is 13.5% higher compared to the same period in 2023. Leasing companies provide entrepreneurs with financing in the form of leasing and leasing loans. Leasing transactions certainly dominate among the contracts concluded. Their value amounted to 47.8 billion PLN (jump by 14.5%) and for leasing loans – 6.4 billion PLN (increase by 6.3%).

Even though the industry results had a slightly lower dynamics in the second quarter than in the first quarter (12.4% in the second quarter vs 14.6% in the first quarter), this year’s results are in line with the annual forecasts. Experts from the Polish Leasing Association anticipate that the market will grow by more than 12% this year, and the total assets financed by leasing companies throughout 2024 will exceed 115 billion PLN. Just a reminder: in 2023, for the first time in history, the level of investments financed by leasing in one year exceeded 100 billion PLN.

The structure of asset financing by leasing companies remains unchanged for years. The majority is vehicles – 73%, followed by machinery and other equipment – 23%, other transactions along with real estate comprise 4% of this structure.

Financing breakdown by assets:

• Vehicles – 39.9 billion PLN (increase by 17.2%)
• Within this category, light vehicles – 29.7 billion PLN (increase by 32%)
• Heavy vehicles – 9.6 billion PLN (down by 14%)
• Machines and equipment – 12.6 billion PLN (increase by 5%)
• Other movable assets – 1.98 billion PLN (increase by 5%)
• Real estate – 0.29 billion PLN (increase by 0.7%)

“Our main driving force are light vehicles, i.e. personal and delivery up to 3.5 tons DMC. In the first half of the year, leasing companies financed by 1/3 more light vehicles than in the corresponding period of 2023. This cannot be said about heavy vehicles. The value of their financing has decreased. For three quarters, the financing of heavy vehicles is in a noticeable minus. The economic stagnation in the euro zone and the hampering of exports do not help this. The transport industry is also facing many challenges, which impacts the investments of transport companies in new vehicles. However, we hope that with an export revival, the mood in the transport industry will improve and the demand for heavy road transport means will increase,” comments Monika Constant, President of the Polish Leasing Association.

Leasing of machines and equipment was dominated by agricultural machines and construction equipment. They respectively constituted 23% and 21% in the structure of financing machines and equipment by leasing companies. However, while the value of financing construction equipment increased (by 33%, up to 2.6 billion PLN), that of agricultural machines fell (by nearly 4%, down to 2.8 billion PLN).

“The decrease in the value of financing agricultural machines was influenced by the confusion caused by the Consumer Credit Act and the Consumer Lombard Loan Act coming into force at the beginning of the year. Farmers started to be treated as consumers, which limited their access to financing provided by leasing companies. Thankfully, an amendment came into force in April that repealed the provision unfavourable to farmers. We therefore count on a rebound in the financing of agricultural machines with a leasing loan,” comments Monika Constant. “In addition, the inflow of EU funds within the Intelligent Development Operational Programme and cohesion programmes should generally increase entrepreneurs’ interest in machines and equipment.

According to experts from the Polish Leasing Association (ZPL), 2024 will bring economic development tied to strong consumer spending and growing business investment, which will clearly support the leasing market results. Even though the dynamics of investments in the economy in 2024 will be lower compared to last year, the investments will be to a much larger extent based on private investments, including SME investments. The SME sector is the main recipient of leasing companies’ offer (taking into account both leasing and leasing loans). Micro and small companies, i.e. with turnover up to 20 million PLN, are, like everywhere else in the world, the largest group of leasing product recipients. According to data for the first half of the year, micro companies (clients with turnover up to 5 million PLN) constituted 53.4% of leasing companies’ clients. Companies with turnover from 5 to 20 million PLN constituted almost 19% of leasing companies’ clients, and 26% of the client structure of leasing companies were made up by companies with turnover over 20 million PLN.

Since the beginning of this year, the leasing industry, represented by the Polish Leasing Association, has been carrying out intensive actions aimed at legislative system changes. This concerned, among other things, changes in the already mentioned Consumer Credit Act.

“We are eagerly awaiting the introduction of a documentary form for the conclusion of a leasing contract, which will make external financing more convenient for entrepreneurs. Intensive cooperation with the Ministry of Development and Technology has brought good results for entrepreneurs using leasing. We are now waiting for the start of work in the Parliament on the first deregulation package, which includes, among other things, provisions on the documentary form,” emphasizes the president of the Polish Leasing Association (ZPL). “The Polish Leasing Association also hopes that the industry’s postulates submitted during the recently completed consultations will be taken into account in the final shape of the “My Electric Bicycle” programme and thus leasing and rental will be allowed for financing e-bikes,” she adds.

The Polish Leasing Association presents a summary of the leasing industry’s results every quarter. The data comes from reports of ZPL member companies and collaborating organisations, hence, including estimation, the Association’s reports cover 100% of the Polish market.