The latest CapEx Finance Index (CFI), released by the Equipment Leasing & Finance Association (ELFA), showed that demand for equipment started off 2026 at a sprinter’s pace. January new business volumes (NBV) reached the highest dollar amount in the survey’s two decades, driven in large part by financing activity at manufacturers. Financial conditions also improved, a sign that a prolonged Fed pause is unlikely to shake industry strength.
Total NBV among surveyed ELFA member companies was $11.6 billion on a seasonally adjusted basis. Year-over-year, NBV increased by 30.1% on a non-seasonally adjusted basis.
“Just as we expected, the equipment finance industry had a strong start to 2026. New activity surged to its highest monthly dollar amount ever, with much of the gain coming from equipment producers,” Leigh Lytle, president and CEO of ELFA, said. “The loss rate retreated after rising at the end of last year, and the average delinquency rate remained stable. It’s still early, but I’m optimistic that continued AI investment will translate into another year of strong growth in new financing activity, even if the Fed decides to put rate cuts on ice for the foreseeable future.”
Equipment demand posted its largest monthly increase ever. Total NBV grew by $11.6 billion in January, an increase of 7.8% from the previous month. The January reading is the largest one-month increase in dollar terms in the two-decade history of the index. The total new volume series tracks the amount of new activity added by banks, independents and captives in a given month. The January spike in total new volume caused the yearly change to surge by 30%. It was the largest 12-month change since February 2018.
Small ticket volume growth tracks broader economic conditions and is an important barometer of aggregate demand for equipment. Small ticket deals grew by $5.3 billion, up 5.5% from December.
Activity at banks dropped by 11.7% from the prior month, while new volumes at independents fell by 2.5%, but the monthly dollar amount remained just slightly below the all-time high set in December 2025. New deals at captives grew by 14.9%. Post-pandemic activity continues to be driven by activity at captives and independents.
The overall credit approval rate dropped for a second consecutive month. The industry-wide average dropped to 76.8% in January, down 1.3 percentage points. While the overall rate has been trending down lately, it remains elevated compared to the period immediately following the pandemic. The average small ticket approval rate ticked down from the prior month to 80.9% and remained near its 2025 average of 80.6%. The rate at banks dropped 1.7 percentage points to 78.9%. The rate at captives rose for the first time in five months, while the approval rate at independents fell by 4 percentage points.
Delinquencies edged up, but losses plummeted. The overall delinquency rate edged up to 2.1% in January. The industry-wide average remained in the middle of its trailing two-year range of 1.8% to 2.2%. The average rates at banks and captives were both up slightly, while the delinquency rate at independents edged down.
The overall loss rate dropped by 0.1 percentage points to 0.46% in January. The January drop more than offset the sharp increase at the end of last year. The average loss rate for small ticket deals also dropped by nearly 0.1 percentage points. The average loss rate for banks edged down from the prior month, while the rate for captives was unchanged. The rate at independents fell sharply by 0.28 percentage points, the largest decrease since March of last year.
“We started a truck rental and fleet management division in 2024, and we are rushing to implement new technology around our fleet offerings that will better consolidate accident management, DOT compliance, equipment returns, transportation of assets, telematic information, billing and other fleet management information and reporting under on holistic solution,” Christopher Enbom, CEO and chairman of AP Equipment Financing and an ELFA member, said. “There are also shortages of certain specialized trucks we offer to customers, and we have been scrambling to be sure we can take advantage of market opportunities. Additionally, we are in the process of increasing our line of credit by $100 million and it has been somewhat delayed, which is stressful due to our high growth.”
Industry Confidence: The Monthly Confidence Index for the equipment finance industry (MCI) tracks the sentiment of executives in the industry. The index rose to 67.6 in February, up from 64.6 in January, and the highest level since January 2025.
Technical Note: New business volume data are concurrently seasonally adjusted each month to capture the latest seasonal patterns. Data in previous months and years may change due to updated seasonal factors.
