Asset finance

Asset Finance – Business Loans that Help Your Business Evolve, Grow & Succeed

Keeping up with the times is essential not only for growth but for mere survival too. This fact of life applies in its entirety to businesses. No business can afford to stay stagnant and still hope to stay profitable. Even the hugely successful market forces are constantly at work, trying to set new trends, carve paradigm shifts and find their way in the ever-evolving world. So, it only makes sense for your business to want to invest in newer, better, more rewarding assets.

These assets can come in many varieties – from prime land properties to prized office addresses, and from stocks with huge growth potential to state-of-the-art machinery. Funding the purchase or lease of such assets without disrupting the cashflow is, however, a tough task. This becomes even more challenging for young businesses. Our asset finance packages deliver a host of robust solutions to all such issues.

What is Asset Finance?

Asset finance, although a specialty finance service in itself, is best viewed as a subset of business loans. These loans are specifically geared towards the lease or purchase of commercial assets.

Available at fair, affordable interest rates over short to medium loan terms, asset finance packages are some of the most commonly used business loans in the UK.

Features of Our Asset Finance Services

• Lower interest rates than personal loans
• Lenders pass the writing down allowances to the borrower to effectively lower or even offset the interest
• Asset-specific specialist lenders
• Fixed, monthly repayment schedule
• Low dependency on the credit health of your business
• Truly independent, Whole-of-market brokerage service

Types of Asset Finance

There are three broad types of asset finance. Whilst the underlying concept remains the same across all types, the ownership of the asset is what differentiates them from one another.

Hire Purchase

Hire purchase is similar to purchasing a new asset on borrowed credit. If your business is unable to put aside enough capital to bear the costs of new assets upfront, you can take a hire purchase loan to finance them instead. Hire purchase finance packages are straightforward business loans with short to medium repayment terms. The borrower retains the full ownership of the asset upon repayment of the loan.

Finance Lease

At times, it makes more financial sense to lease an asset than purchase it altogether. This is especially true in cases involving heavy-duty machinery. If your business has such requirements, you can go for a finance lease. A finance lease allows you to ‘borrow’ the asset itself, instead of money, from the lender. The rental cost is usually paid in fixed instalments if the lease tenure is long enough.

Operating Lease

Operating lease is quite similar to finance lease. The only difference between the two is that an operating lease requires the borrower to enter into a revenue sharing agreement with the lender. A typical example of operating lease is renting a fleet of commercial vehicles or commercial floor space.