£37.6bn of finance helping power growth across Northern England
The finance industry provided £37.6bn to businesses and households across Northern England last year, underlining the critical role private finance can play in delivering the government’s growth mission, according to a new paper from the Finance & Leasing Association (FLA).
The Engine Behind Northern Growth argues that closing the North’s productivity gap will require businesses to invest, people to be able to participate fully in the economy and government to create the infrastructure and regulatory environment that allows private capital to work.
The paper finds that finance provided by FLA members is particularly important to northern economies. In 2025, new finance 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 – in each case above the UK-wide figure of 6.0%.
Shanika Amarasekara MBE, chief executive of the Finance & Leasing Association, said: “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 the finance businesses use to invest in machinery, vehicles, technology, equipment and clean energy, while motor and consumer finance helps millions of people access transport, employment and essential goods.
The paper highlights how that investment is already translating into growth across the North.
In Hull, finance provided by a lender 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 buy specialist equipment and open a second café, creating jobs while preserving cashflow for further growth.
And in Greater Manchester, individual underwriting by a lender enabled a customer to obtain a vehicle and remain in employment – demonstrating the link between responsible finance, financial inclusion and economic participation.
The FLA paper identifies five practical opportunities for government and industry to unlock further northern growth: modernising consumer credit regulation; delivering proportionate and predictable regulation; encouraging investment in productive assets; improving transport connectivity; and making financial inclusion part of the government’s growth mission.
It argues that transport in particular should be viewed as economic policy, not simply infrastructure policy. Poor connectivity reduces businesses’ access to workers, customers and markets and ultimately reduces the return on private investment.