What is finance lease?
You may also hear this type of funding called lease purchase – both terms cover the same legal concept. In a finance lease arrangement, a business rents an asset through regular repayments. They gain exclusive usage rights for the duration of the agreement, while ownership remains with the finance company.
This offers the combined benefit of usage of the asset, and increased working capital for allocation elsewhere in the business. Because the asset acts as the security, finance lease is often quick and easy to set up.
Who is suitable for finance lease?
Businesses who need the latest assets to maximise their competitive edge can benefit from finance lease. Because monthly payments are much lower than the overall cost of the asset, working capital remains available for investment in growth and expansion. The asset also generates income during use, meaning it effectively contributes toward its own repayment.
Finance lease is often the best option for businesses looking to gain access to assets, whether vehicles, IT equipment, machinery, equipment, or something else. You can enjoy the benefits of ownership without the cost or commitment, as well as certain tax perks: monthly repayments can often be offset against your tax bill, and up to 100% of the VAT can be claimed back if the asset is used exclusively within your business.
No limitations on how you use the money
- Fixed interest rate and no hidden fees
Weekly or monthly repayments
Same day decisions
Less than ideal financial histories considered
Applications accepted from any industry