Finance worth £37.6bn was provided to businesses and households across Northern England last year, according to a new paper from the Finance & Leasing Association (FLA).
The FLA says private finance has an important role to play in improving productivity and supporting economic growth across the North, alongside investment in infrastructure and changes to the regulatory environment.
Its paper, The Engine Behind Northern Growth, argues that narrowing the region’s productivity gap will require businesses to invest, greater participation in the economy and an infrastructure and regulatory framework that allows private capital to operate effectively.
Finance provided by FLA members in 2025 was equivalent to an estimated 8.2% of regional GVA in the North East, 7.7% in Yorkshire and the Humber and 6.6% in the North West. All three figures were above the UK-wide level of 6%.
Shanika Amarasekara MBE, chief executive of the Finance & Leasing Association, says: “Growth does not come from a single policy lever pulled in Whitehall. It happens when businesses are empowered to invest in what I call the real economy.
“Much of what our members finance is the practical investment businesses make every day through machinery, vehicles, equipment and software. Crucially, these are the assets businesses use to become more productive.
“The North does not need another isolated answer to its growth problem. It needs a policy environment that is calibrated towards helping businesses invest, expand and compete, backed by the infrastructure and access to finance that make those decisions possible.
“Government cannot deliver that alone, and neither can industry. But if both are willing to work together, there is an opportunity to turn more of the North’s existing economic strength into higher productivity and stronger growth.”
FLA members provide finance for business investment in machinery, vehicles, technology, equipment and clean energy, as well as motor and consumer finance.
The association points to examples of finance supporting investment across the North. In Hull, funding is helping SMEs install rooftop solar systems, with participating businesses saving an average of more than £20,000 a year on energy bills.
In the North West, asset finance enabled an independent hospitality business to purchase specialist equipment and open a second café, while retaining cashflow for further investment.
The paper also cites an example in Greater Manchester where individual underwriting enabled a customer to obtain a vehicle and remain in employment, which the FLA says illustrates the relationship between access to finance and economic participation.
The FLA identifies five areas where it believes government and industry could support further growth: modernising consumer credit regulation, delivering proportionate and predictable regulation, encouraging investment in productive assets, improving transport connectivity and incorporating financial inclusion into the government’s growth agenda.
It also argues that transport connectivity should be treated as an economic issue as well as an infrastructure priority, with poor connections potentially limiting businesses’ access to workers, customers and markets and reducing returns on private investment.
