Societal shifts pave way for fintechs in equipment finance

From embedded finance platforms to AI-driven fraud prevention, fintechs have emerged as key players in the equipment finance industry as societal shifts alter dealer and lender operations. 

The global fintech market is projected to reach nearly $1.2 trillion by 2032, a more than threefold increase from $340 billion in 2024, according to market research firm Fortune Business Insight. The AI revolution has accelerated the rise of fintechs in equipment finance, allowing lenders to perform tasks such as loan approvals, credit scoring and data processing faster than ever.  

Moreover, changes in consumer behavior driven by the need for “instant gratification” are prompting dealers and lenders to lean on fintechs to meet customer demand, Robin Salter, chief marketing officer at Wilmington, N.C.-based Approve, told Equipment Finance News. Approve is an equipment finance solutions provider that instantly connects borrowers with lenders through a plugin on dealers’ computers after a roughly 60-second loan application process. 

“For younger generations, that instant gratification is something that they expect,” he said. “We are pushing to have equipment financing feel like a credit card transaction so that the customer comes to the site, they identify the equipment and … when the buyer is ready, we believe there will be a time when the finance application will spit out.” 

More lenders are partnering with fintechs to help equipment dealers introduce financing options at the point of sale rather than acting as an intermediary between the customer and lender, Northteq Chief Executive Kristian Dolan told EFN. Minneapolis-based Northteq is a software provider that offers automated loan origination platforms.  

“Borrowers and vendors expect an automated digital experience that gets them funding fast,” he said. “There has also been a push toward embedded solutions where borrowers and vendors have the financings integrated directly with their point-of-sale system or website.” 

With Northteq’s dealer portal, the financing process is fully automated after a dealer takes a picture of a loan application, Dolan said. 

The pandemic accelerated digitalization and the need for fintechs in the equipment finance sector, Gary Brackenridge, executive vice president at global software, data and analytics provider Linedata, told EFN.  

Still scratching surface 

In the second quarter, 83% of roughly 300 banks and capital markets firms reported plans to increase spending on data management technology, according to research firm Statista. Seventy-five percent planned to increase spending on cloud computing services, and 63% planned to increase spending on AI and machine-learning solutions. 

Fintechs accounted for about 5%, or $150 billion to $205 billion, of net revenue in the global banking sector in 2022, according to consulting firm McKinsey and Co. Fintechs’ banking revenue share is expected to grow to 15%, more than $400 billion, by 2028. 

As more equipment lenders adopt technology, providing solutions that are affordable and easy to use will be crucial for fintechs, Krishna Mehta, principal at Millburn, N.J.-based data analytics firm Jigyasa Analytics, told EFN. 

“I see a greater desire and openness toward technology,” he said. “And there is always a learning curve. Technology has become easier to use, and that has opened up greater adoption, but that is something that will need to continue.” 

Fintechs should also avoid being too “techie” at the dealer level so that the implementation process is as seamless as possible, Approve’s Salter said.  

The third annual Equipment Finance Connect at the JW Marriott Nashville in Nashville, Tenn., on May 14-15, 2025, is the only event that brings together equipment dealers and lenders to share insights, attend discussions on crucial industry topics and network with peers. Learn more about the event and register here.