Asset finance

How asset finance works

Asset finance is a means of obtaining assets for your business without using existing business capital. The assets are used as security for the loan which means that in many cases, the asset finance does not impact on the business’s other credit lines.

An alternative to asset finance may be asset rental. In this case, the financier purchases the asset and leases it to the business. This may be appropriate for assets that quickly depreciate in value or need frequent upgrading, such as computers.

The benefits of asset finance

  • In most cases, the asset being purchased will provide the loan security, allowing the remaining assets to be used for other credit lines

  • The asset finance can be tailored to match the life of the asset and payments can be scheduled to align with its ability to generate cash flows for your business

  • Similarly, loan repayments can also be structured to match seasonal variations in your business’s cash flow