Asset Finance
Asset Finance
Asset finance is a way for businesses and individuals to acquire assets such as vehicles, machinery, or equipment without having to pay for them upfront.. It allows businesses to spread the cost of the asset over a fixed period of time, making it more affordable and easier to budget for.
There are various types of asset finance available in the UK, including hire purchase, lease, and loan finance. Hire purchase involves paying monthly instalments to the lender, who owns the asset until the final payment is made. Lease finance allows businesses to use the asset for a fixed period of time, paying a rental fee to the lender.
Asset finance involves borrowing money from a lender to purchase the asset, with the asset serving as security for the loan. Asset finance is typically used to fund the purchase of expensive assets that may be out of reach for businesses without it. It can also be used to upgrade or replace existing assets, or to finance the expansion of a business.
Asset finance is available from a range of lenders, including banks, specialty finance companies, and online platforms. It is important to carefully consider the terms and conditions of any asset finance agreement, as well as the total cost of the asset, before committing to a deal.
Asset-based lending is a way for established businesses to finance rapid growth or big contracts, using assets such as invoices, inventory, equipment, machinery, or commercial property as security for a business loan.
What is asset-based lending?
Typically, an asset-based loan is a structured combination of invoice finance and a business loan — for example, invoice discounting alongside an unsecured business loan.
This allows the business to maximise cash availability and serve bigger contracts, recruit or invest.
Why use asset-based lending?
If you’re looking for a way to fund your business, you might be able to find it in your balance sheet — where cash is tied up in various assets. Asset-based lending allows you to release this cash to fund an expansion project or simply accelerate day-to-day cash flow.
Asset-based lending uses your sales ledger and physical assets such as machinery, stock, and property. It’s suitable for larger businesses and corporates and gives you the funds necessary for both cashflow stability and longer-term growth.