Asset Finance Software Market Size, Share & COVID-19 Impact Analysis, By Asset Type (Hard Assets and Soft Assets), By Deployment (Cloud and On-premise), By Enterprise Type (Large Enterprises and Small & Medium Enterprises) By End-user (Transportation, IT & Related Services, Construction, Agriculture, Medical Equipment, Banks, Industrial/Manufacturing Equipment, and Others), and Regional Forecast, 2023-2030

The global asset finance software market size was valued at USD 3.60 billion in 2022 and is projected to grow from USD 3.81 billion in 2023 to USD 6.59 billion by 2030, exhibiting a CAGR of 8.1% during the forecast period.

Asset finance software's purpose is to help manage IT assets, such as associated contracts, asset tracking (organization's or leased assets), and invoice management. A business can gain many profits, such as greater efficiency, increased productivity, profitability, and smooth inventory processes with this software. Some of the tools considered in this market study are Ausloans’ Zink, LDMS Engage, FIS Asset Finance, Banqsoft Asset Finance Software Suite, and automotive finance and equipment finance offered by Alfa Financial Software Limited, among others. These software can incorporate present business tools to impeccably manage and track with an approach that will make day-to-day procedures run like clockwork, adding better control of finances to guarantee these improvements.

COVID-19 IMPACT

Increased Demand for Asset Finance Software from Several Industries to Fuel Market Growth

At a global level, government restrictions, national lockdowns, and stagnated consumer spending reduced demand for asset finance during the early pandemic. This industry noted constant funds for its advancements and has substantially contributed to economic growth. However, this industry had been temporarily impacted by the outbreak of the COVID-19 pandemic. In addition, lack of logistics and raw materials supply has disturbed every industry's supply chain and hindered new product launches, increasing the need for finance assets. Thus, the increasing use of assets on a lease basis surged the demand for this software in the post-COVID-19 era.

Moreover, companies are embracing the idea of implementing asset finance software to finance assets on a lease basis to get periodic installments, which benefits the companies and businesses renting the assets.

LATEST TRENDS

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Rising Adoption of Subscription-based Models to Boost Software Demand

In the automotive industry, environmental considerations, technology advances, and fluctuating consumption patterns are shifting from independently owned vehicles toward an autonomous and shared mobility model.

The liability for leasing and flexibility ownership increases by bundled services in corporate fleets, paying for transport on demand, or functionality driven by new vehicle technologies. In addition, new players aim for flexible mobility opportunities, leveraging the availability of new technologies such as EVs. For instance,

• Onto, the U.K.-based EV subscription start-up, provides a range of commitment-level options and a vast variety of services for mobility, ranging from car leasing to servicing.


• Furthermore, in August 2020, Porsche collaborated with Clutch Technologies and announced the Porsche Drive subscription and Porsche Passport plans to provide on-demand access to a-la-carte mobility services and cars while Audi offers a rental car plan through their Silvercar proposition.

Thus, the aforementioned factors are likely to propel the asset finance software market share during the forecast period.

DRIVING FACTORS

Growth in Global Average Price of Asset to Propel the Market

The rising demand for branded equipment and new commercial models has become one of the primary growth factors in the market. As the company's preferences and trends toward retail equipment purchases have augmented tremendously, the need for utility vehicle financing and loans is anticipated to rise, maintaining dominance in the market. Therefore, the global average cost of cars has increased concurrently with the demand for utility vehicles in manufacturing organizations for carrying goods. Thus, a considerable rise in vehicle prices forced companies to shift from direct purchases to finance vehicles. For instance,

• In the U.S., the standard cost of a new car purchase increased to USD 36,718 in 2019 from USD 35,742 in 2018, with interest charges of approximately 6% and 2%, respectively.

As a result, these vast prices imposed over the average cost of vehicles are expected to boost asset finance software market growth during the forecast period.

RESTRAINING FACTORS

High Installation Costs of Software to Hinder Market Augmentation

The asset finance software allows customers to purchase assets and aids in managing them. However, the installation costs are high and require professionals to complete the task. Further, the software is available on a monthly, quarterly, or yearly basis, but the cost of the software is expensive. In addition, high screen loading time is an issue for the users, but the developments in the upcoming upgrades are expected to minimize these errors.

Hence, the factors mentioned above are expected to restrain the market growth.

SEGMENTATION

By Asset Type Analysis

Hard Assets to Lead Owing to their Surging Demand after the Pandemic

By asset type, we have considered hard assets and soft assets. Amongst them, hard assets hold the highest market share owing to the high demand for heavy equipment in the manufacturing, agriculture, and transportation industries. Further, as the price of these heavy equipment is comparatively higher than that of soft assets, customers often prefer buying these assets on a finance basis.

The soft assets segment will grow steadily during the forecast period owing to increasing number of startups in the Middle East & Africa, Asia Pacific, and South America. Therefore, the need for soft assets such as software and light equipment required for the setup increased, fueling the market's growth during the forecast period.

By Deployment Analysis

Cloud Segment to Lead Owing to Swift Digital Transformation

Based on our analysis, the deployment of the software is implemented over cloud and on premise. The cloud segment holds the maximum market share. It is also expected to grow at the highest rate during the estimated period as cloud-driven deployment enables minimal maintenance, decrease in cost, quicker distribution, and increased scalability.

The on-premise segment has high software installation costs and upgrading charges, making users choose cloud-based software owing to its benefits. This shift in using cloud-driven software hampered the growth of the on-premise segment.

By Enterprise Type Analysis

Large Enterprises Segment to Dominate Backed by Surging Product Demand

As per our study, the large enterprises segment will dominate the market during the forecast period due to early adoption of the software. Moreover, large enterprises' high demand for managing assets fueled revenue growth.

Furthermore, the small & medium enterprises segment is predicted to witness a rapid growth rate during the forecast period owing to new developments in SME asset finance. For instance,

• In May 2021, a U.K. start-up bank announced plans to introduce an SME asset finance product powered by Mambu's cloud banking platform.

By End-user Analysis 

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Increasing Usage of Second-hand Vehicles to Boost the Transportation Industry

According to our analysis, the transportation segment held the highest revenue in 2022, owing to a surge in purchasing second-hand transportation facilities on a financial basis. Furthermore, in the post-COVID-19 pandemic, new vehicle rates were booming, forcing individuals to choose second-hand transportation facilities through asset finance software, boosting the market growth.

Further, the construction segment is expected to record the highest CAGR during the forecast period as many construction industries have started to purchase equipment such as excavators, bulldozers, loaders, and others on a finance basis.

REGIONAL INSIGHTS

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As per our report, the market is studied across North America, South America, Europe, the Middle East & Africa, and Asia Pacific. These regions are further categorized into leading countries.

North America dominated the market in 2022 with a revenue share of over 30%. North America has taken a significant lead in infrastructure development and technology adoption. A strong presence of large IT companies and rapid digitization in the U.S. and Canada would drive the market. In addition, increasing use of connected, smart, and secure technologies for asset-centric applications is also expected to drive the market's growth.

Asia Pacific is emerging as one of the fastest-growing regional markets and offers immense potential for market growth. The growing adoption and deployment of advanced technologies, such as cloud-based solutions, fuels the demand for subscription-based asset finance software.

Europe holds the second highest share in the global market owing to the presence of key players in the region. For instance, Banqsoft is a supplier of financial solutions for digital banking, asset finance, and credit management organizations in the Nordics, delivering solutions to aid auto finance companies stay competitive in the market.

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The growing productivity in the manufacturing and agriculture industries in the Middle East, Africa, and South America is expected to boost the opportunity for asset finance software suppliers. The manufacturing industries are becoming a crucial economic indicator of Middle East & African countries over the past few years. According to the World Bank’s World Development Indicators database, the Middle East and African manufacturing sector has gained steady growth, expanding at 12.37% in 2020. Hence, the need for software in renting manufacturing equipment and tractors for agriculture will be high in the upcoming years, fueling the regional growth.

KEY INDUSTRY PLAYERS

Key Players Launch New Products to Strengthen their Market Positioning

Major players in the market are developing new and advanced asset finance solutions for customers in the market. They also aim to enhance their existing product portfolio to provide flexible and easy-to-use asset finance solutions. In addition, the companies focus on partnerships, collaboration, and acquisitions to improve their product offerings.

List of Key Companies Profiled:

• Oracle Corporation (U.S.)


• Banqsoft (Poland)


• ieDigital (U.K.)


• Lendscape Limited (U.K.)


• Alfa Financial Software Limited (U.K.)


• Odessa Technologies (U.S.)


• CHG-MERIDIAN (Germany)


• Ausloans Finance Group (Australia)


• CGI Inc. (Canada)


• FIS (U.S.)

KEY INDUSTRY DEVELOPMENTS:

• October 2022: CHG-MERIDIAN collaborated with OPC Asset Solutions, an asset lifespan manager based in Mumbai. The CHG-MERIDIAN Group's plan focuses on internationalization, growth, and sustainability.


• September 2022: Alfa Financial Software Limited launched the Version 5.7 of Alfa Systems, the company’s software tool for asset finance that offers new enhancements in the user experience, charges and billing, and configuration.


• November 2021: Toyota Financial Services (U.K.) expanded its partnership with ieDigital to introduce a mobile app and web portal for customers.


• November 2021: Banqsoft and Wasa Kredit collaborated on a core system for Asset Finance, which is delivered as a service. Further, Wasa Kredit aimed to strengthen its presence within the Swedish asset finance industry by introducing new financial services with a robust digital footprint, including hire purchase, consignment, leasing, and loans.


• January 2020: Lendscape, a finance technology provider, launched Lendscape Asset Finance, a new tool developed to help lenders and banks fuel productivity by streamlining everyday administrative tasks.

REPORT COVERAGE

An Infographic Representation of Asset Finance Software Market

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The research on the market comprises prominent areas worldwide to get a better knowledge of the industry. In addition, the study provides insights into the most recent market trends and an analysis of technologies being adopted quickly globally. It also highlights some of the growth-stimulating restrictions and elements, enabling the reader to gain a detailed understanding of the market.

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