Business Equipment Financing Surged in December

Borrowing among U.S. businesses for the purposes of equipment financing increased in December, offering critical evidence that the economic climate is improving.

According to the Equipment Leasing and Finance Association's Monthly Leasing and Finance Index, capital-equipment financing surged by 20 percent last month from the same period in 2010. Meanwhile, the approval rate for loans and leases surpassed 79 percent in December over the previous month.

Leasing and financing activity picked up considerably during the final months of the year, stemming a tide of stagnant growth seen last summer. December is usually the busiest month of the year for financing, reports Dow Jones Newswires. Companies use this time to budget equipment purchases that were delayed earlier in the year.

"Confidence is on the rise and businesses are beginning to replace aging equipment since they have been holding back over the previous few years," said David Schaefer, president of Orion First Financial, in a statement. "We remain optimistic that equipment replacement will continue but we aren't certain we have entered an expansion phase across all industries."