The Equipment Leasing Association of Nigeria (ELAN) has revealed that the Nigerian leasing industry experienced impressive growth of 23.2% in 2024, with total transaction volumes reaching N5.16 trillion, up from N4.19 trillion in 2023.
The association further estimated that the leasing sector has contributed approximately N24.6 trillion to Nigeria’s economy over the past decade, showcasing its significant role in driving economic development.
In a statement, ELAN attributed the 2024 growth to the robust performance of key sectors such as oil and gas, transportation and logistics, and manufacturing. According to ELAN’s report, the oil and gas sector accounted for 26% of the outstanding leases, totaling N1.3 trillion, followed by transportation and logistics with 21% at N1.1 trillion. Manufacturing also played a crucial role, representing 13% of the leasing volume with N734 billion. Other sectors, including telecommunications, agriculture, government, healthcare, and education, also contributed significantly to the industry’s performance.
The breakdown of the leasing sector in 2024 was as follows:
- Oil and gas: N1.3 trillion (26%)
- Transport and logistics: N1.1 trillion (21%)
- Manufacturing: N734 billion (13%)
- Telecoms: N462 billion (9%)
- Agriculture: N378 billion (8.5%)
- Government: N345 billion (7.5%)
- Others (including healthcare and education): N686 billion (15%)
ELAN explained that the surge in lease volumes was largely driven by the rising cost of assets, a consequence of two major government reforms: the removal of petrol subsidies and the floating of the Naira. These changes required more capital to finance leases, pushing up transaction volumes across the sector.
Additionally, the association pointed to several factors contributing to the industry’s growth, including the influx of new entrants and investments, continuous innovation, and a heightened awareness of the advantages of leasing. With asset prices on the rise, leasing has become an increasingly appealing option for businesses looking to manage capital costs more efficiently.
In terms of lease types, finance leases continued to dominate the market, accounting for 52% of total transactions. However, operating leases have gained ground, particularly among corporate clients who prefer flexible financing options. Some leasing companies have also expanded their offerings by setting up workshops to provide services to external customers.
Vehicle leasing remains the largest segment of the market, representing approximately 53% of leased assets. This includes vehicles for staff shuttles, commercial buses, haulage trucks, and operational vehicles. ELAN highlighted that vehicle leasing continues to be a key attraction, driven by rising demand for transportation solutions in the face of growing infrastructure spending by the government.
The leasing industry is expected to maintain its resilience, with significant growth potential, particularly as sectors like transportation and other critical infrastructure continue to expand. The increasing demand for creative financing solutions, alongside the government’s economic agenda, is anticipated to drive further development in the sector.
