The specialization of leasing companies has long been a topic of discussion. Whether in financial leasing or operating leasing, the notion of “professional specialization” is often held aloft as a founding principle. Yet, when asked what exactly constitutes such specialization, responses vary widely, lacking consensus. This article aims to outline an epistemological framework for understanding specialization within the leasing industry.

1. Current Approaches to Specialization Strategy in Leasing

A review of strategy statements from nearly 40 leasing companies reveals four general dimensions of “specialization”:

(1) Industry or sector focus.
Common examples include: aviation and shipping, high-end equipment, infrastructure, urban operations, green/environmental sectors, energy and power, public utilities, education and culture, healthcare, and consumer welfare.

(2) Equipment type or lease asset.
Typical examples: aircraft, ships, automobiles, wind turbines, batteries, computers, etc.

(3) Customer segmentation.
E.g., SMEs, microenterprises, specific industrial clients, etc.

(4) Product or capability.
Such as: structured finance, SME finance, lease-investment integration, data platforms, or ecosystem strategies.

These examples illustrate that specialization in leasing is inherently multi-dimensional—there is no singular definition or model.

2. Why So Many Interpretations?

This diversity arises from varied understandings of the fundamental nature of modern leasing.

In recent years, the term “returning to the essence of leasing” has gained popularity. It has prompted some to re-emphasize equipment leasing, asserting it as the “true” form of leasing, while viewing other forms—especially those resembling loans—as “quasi-banking.” But the key question remains: Should we return to traditional leasing, or to modern leasing?

Historically, leasing dates back over 4,000 years, with records of Iranian priests leasing agricultural tools to farmers. From the Age of Exploration to the Industrial Revolution, leasing extended to carriages, ships, locomotives, sewing machines, etc.—all asset-based. Hence, some argue that the “essence” lies in physical equipment leasing.

However, modern leasing, which combines asset usage with financial services, emerged around a century ago as an innovation that balances capital and assets, efficiency and risk. According to leasing expert Sudhir Amembal, mature modern leasing involves deep integration between finance, leasing, and industry. In this view, returning to the “essence” means promoting compliant, innovative synergy among capital, leased assets, and industry needs.

The debate over “true vs. false leasing” is not very meaningful. Ignoring either side—whether over-emphasizing capital or fixating solely on assets—misses the point. The essence of modern leasing lies in their integration.

3. How Should Leasing Companies Define Specialization?

Specialization fundamentally depends on a company’s strategic self-awareness and capability-building. Two core competencies are essential:

(1) Capital Intermediation Capability

This refers to the ability to fulfill funding needs in specific industries under regulatory compliance. Many leasing companies highlight focus areas like high-end equipment, energy and chemicals, infrastructure, and environmental sectors—but what underpins these strategies is actually their financial structuring and liquidity management capabilities.

Here, lease objects are not just regulatory compliance tokens or risk buffers; more importantly, success depends on mastering credit assessment and liquidity management.

Leading financial and operating leasing companies dominate the market precisely because they have built robust capital intermediation systems. While many frame their specialization in terms of “strategic” or “emerging” sectors, these labels are only relevant because their capital capabilities genuinely serve those sectors. If a leasing firm truly possesses compliant, flexible funding capabilities, then applying them to strategic industries is both legitimate and value-generating.

(2) Asset-Based Operational and Ecosystem Capability

This involves building an industrial value chain or ecosystem around a specific asset type. Companies selecting lease assets aligned with their core strengths must develop capabilities from manufacturing and procurement to operation, maintenance, and residual value management.

Such ecosystems include OEMs, traders, investors, financial institutions, evaluators, and disposal entities, with profit models derived not just from lease payments, but from multi-link value creation across the asset lifecycle.

Transport and construction machinery leasing are typical examples. Asset selection is often tied to shareholders’ industrial backgrounds.

A simple test of this capability is: Can you run an operating lease model for that asset class? Only with the ability (and willingness) to take on operational leasing risk can a firm claim to have built professional asset management capabilities. This path demands strategic patience, industry knowledge, and long-term commitment, but once established, it yields significant competitive advantages.

The Key Enabler: Digitalization

Whether focusing on capital intermediation or asset-based operations, digital transformation is essential. From data mining, client segmentation, risk modeling, fast approvals, and capital allocation, to asset monitoring and residual management, every aspect hinges on data systems.

As Jack Ma once said: “He who controls the data, controls the future.” That sentiment rings particularly true in leasing.

Closing Thoughts

In China’s leasing market today:

• Some companies are advancing structured finance (capital capability);
• Others are developing specialized platforms (asset capability);
• A few are building both (e.g., large-scale financial and industrial leasing firms).

Each is progressing along its chosen path, demonstrating that specialization in leasing is not singular—it’s an evolving, multi-path, capability-driven journey.

Let a hundred flowers bloom; let ten thousand horses gallop. The future of leasing specialization lies in capability—diverse, data-driven, and deeply integrated.

By Wang Yongsheng, Academic Member of the Global Leasing Industry Competitiveness Forum