Equipment finance is generating some big numbers this year, but the more interesting story may be what those numbers represent. According to the Equipment Leasing & Finance Association’s August 2026 CapEx Finance Index, new business volume reached $11.8 billion, making August the second-highest month in the index’s history. ELFA now forecasts $137.7 billion in new business volume for 2026, which would be the highest annual level since the index began.
For investors, though, market size is only part of the picture. The more revealing question is what that volume represents, and how those businesses and assets come together in a portfolio.
Within that broad category are businesses with different operating models, assets with different uses, and economic activity driven by different forces. Together, they give equipment finance a wider range of economic exposures than the category label might suggest.
That diversity helps explain what makes the asset class distinctive, and why the mix of businesses and assets in a portfolio can matter to investors.
What makes equipment finance distinctive is its connection to the businesses using the assets. A restaurant, construction company, farmer, or manufacturer may all need equipment to operate, but the economics behind those businesses can look very different. Their revenue, operating environments, and capital needs create different drivers of performance.
Jennifer Wood, SVP, Head of Commercial Client Experience at Concord describes the asset class this way: equipment finance is “diverse by industry, diverse by situation, diverse by geography.”
A pizza oven and a backhoe may both be financed as equipment, but they support different businesses, operate in different markets, and serve very different purposes. How that equipment is sold, financed, and used can also influence the economics of the portfolio.
What drives performance can vary significantly depending on the business behind the asset. Construction equipment, for example, can be influenced by project activity and capital spending, while agricultural equipment is shaped by a different set of operating and market conditions. Ultimately, the business generating the cash flow is part of the credit story too.
As Jennifer puts it, “When you combine a farmer with a construction worker with a restaurant owner you get a diverse credit risk profile.”
The portfolio is where those individual exposures start to shape the bigger picture.
Jennifer uses credit cards to illustrate the difference. A credit card portfolio is largely tied to the U.S. consumer economy, so changes in the economy can affect many of those accounts in similar ways. Equipment finance draws from a much wider range of businesses, from agriculture and construction to restaurants and manufacturing.
ELFA’s latest industry data puts that diversity into perspective. Among the largest end-user categories in 2024 new business volume were:
Those categories alone illustrate how different types of businesses can sit within the broader equipment finance market. The result can be a portfolio where performance doesn’t hinge on what happens in one industry or to one type of borrower. The composition of that portfolio becomes part of the risk story.
The appeal of that diversity is the range of economic activity represented within a single asset class. Equipment finance can connect credit to businesses across industries, markets, and operating models, giving a portfolio exposure to more than one economic story.
Jennifer puts that connection into perspective:
“What I find compelling about equipment finance is how closely it connects credit to the real economy. You’re financing the equipment a business actually needs to operate, whether that’s a truck, a piece of manufacturing equipment, or something as simple as a commercial oven. When you step back and look across a portfolio, you’re seeing a very different cross-section of economic activity.”
Equipment finance gives investors access to a wide range of businesses and economic activity. But that diversity is only the starting point. What matters is how that diversity is reflected in the portfolio itself.
A closer look at portfolio performance can reveal where the exposure sits, what is driving it, and how those exposures come together. That’s where the investment story gets specific.
At Concord, we support originators, lessors, and investors with credit administration for commercial and equipment finance portfolios. Looking at an equipment finance portfolio? Let's talk.
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