Who are the Players in the Canadian Equipment Leasing Industry

Overview of the parties involved in the Candian business equipment financing industry

The players , or participants in the Canadian Leasing industry have evolved significantly over the last several years . The evolution of the participants in this market is a combination of economic factors as well as gradual specialization and focus of specific players in the industry .<br><br>The industry in Canada is self governed by the organization known as the CFL A - The Canadian Finance and Leasing Association . <br><br>This association , which represents all significant lessors and lease related firms provides us with an excellent sense of the size and dynamics of the industry . The association reports that over 108 Billion, ( yes that;s Billion ) dollars of financing is currently in place by association members . The association broadly represents 3 major groups :<br><br>* Asset based lenders<br>* Vehicle lessors<br>* Equipment lessors <br><br>The association maintains that after the Canadian banks the members of the CFLA are the largest providers of debt financing in the country . The association commission a report in which it was maintained that as a direct result of the financing provide to Canadian business the overall standard of living in Canada rose by about 2.3% over the past decade.<br><br>The association has approx 190 members and represents firms all across Canada .<br><br>Independent firms represent a very large part of the industry . These are , in essence, private non-bank finance companies, generally not public firms . The industry is actually broken down into 3 separate groups - the lessors themselves, captive finance companies which are directly associated with manufacturers, and a third group who are originators or brokers of lease financing activity . <br><br>The independent finance firms are just that, independent . They are not directly associated with any specific product, service, or manufacturer . At the end of the day they simply finance their customers acquisitions, whatever those products might be . In any given transaction then there are three parties - the independent lessor, the provider of the equipment, and of course the customer or lessee. <br><br>In Canada some banks and life insurance companies are involved in leasing, but they are in most cases involved in financing the independent lessors themselves , as opposed to originating leases for their customers . <br><br>Captive lessors are a huge part of the industry also . These firms are directly related to a manufacturer . The author of this article worked for many years with HEWLETT PACKARD FINANCE . HP FINANCE is of course affiliated with its parent company, Hewlett Packard , and has the standard captive finance company mandate . That mandate is simply to assist the parent company in the sales of product that otherwise might not have been acquired if financing had not been offered or put in place . <br><br>As has been discussed , the final type of player in the industry is the lease originator, commonly called broker . These firms or individuals have a full knowledge of the industry and its participants and are able to package transactions in the interest of all parties, i.e the lessor and the customer or lessee. <br><br>The industry has gradually involved in Canada to what we have called specialization . Firms gradually seem to have realized that no one firm can ' do it all ' with respect to financing breadth, geographical focus, and product or asset focus . <br><br>These three players in the leasing industry are of course why the industry grows and prospers . They offer Canadian business the financing companies need, allowing them to utilize bank credit for other growth and purposes.

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