What is business equipment financing?
Business equipment financing is a type of business finance that provides companies with the required capital to purchase equipment to grow your business. As just a few examples, this can include the purchase of heavy machinery, vehicles, computers and any other sort of expensive office equipment.
Using business equipment financing, your company will be provided with the necessary funds to secure your required business equipment, and in return you will be required to pay back the money with interest in scheduled monthly repayments.
Why do businesses need equipment financing?
Equipment needs to be replaced and updated on a regular basis, for the most part, it is not just a single, one-off cost. Technology is continually advancing and it is essential for business owners to keep up with these advancements to avoid falling behind the times; a computer from just seven years ago is unable to carry out nearly all the same functions as a computer from 2020.
- It allows entrepreneurs to keep their assets up to date and their businesses on top of their game.
- Can be a true lifeline for when things go wrong and random breakages or faults occur.
How often do businesses need to consider equipment financing?
As practically every single company is reliant on equipment, this form of finance is a popular and very common choice. The majority of entrepreneurs will consider equipment finance at some point in their careers, to help keep their cash flow steady and business operations running smoothly and successfully as possible.
- Every couple of years you may wish to replace or update certain equipment, and financing can help you to easily afford to do so.
What are the most viable options to finance equipment?
There are multiple ways to finance equipment for your business in the UK. Ultimately, finding the right equipment financing for your business is dependent on your type of business and this can vary. Bearing this in mind, let’s consider several practical ways to finance equipment:
- Business equipment loans: Best for UK SMEs looking for a straightforward way to quickly receive business equipment financing.
- Hire purchase: A good option for businesses who don’t mind using the equipment on a hire basis until all payments have been made.
- Operating lease: Equipment leasing is the ideal finance solution for businesses that need equipment for the very short-term.
- Merchant cash advance: A funding product that best suits businesses that take the majority of their payments via credit or debit card transactions.
- Business credit card: Easy for businesses already familiar with using and paying off a credit card efficiently.
- Asset finance: The physical equipment or asset is financed by the lender, the business will then repay a regular sum of money to the lender. Eventually, the equipment can become the property of the business overtime, depending on the arrangement.
Why is it difficult for businesses to raise enough capital to fix equipment and purchase assets?
Buying new equipment and even making repairs to old equipment, can cost your business a substantial amount. For startups and small businesses in particular, this cost can be exceedingly difficult to afford upfront. With this being said it is generally a cost that cannot be skimped on, as good quality and reliable equipment is essential to every business.
- Certain types of equipment need to be updated frequently, this is particularly true for businesses in industries that use heavy machinery daily.
- Emergencies like unexpected breakages can occur even to equipment of the very highest quality. As a result, the cost of equipment can be potentially difficult to budget for, particularly for small businesses with limited cash flow.
What is a business equipment loan?
A business equipment loan is an unsecured finance option used to help businesses purchase expensive and technical work equipment. Businesses will usually use this loan to help purchase, lease or repair equipment that is imperative to their manufacturing and production process. This is used by businesses such as construction firms.
Equipment is imperative to the manufacturing and production process, without ample cash for equipment management it can be difficult to maintain business growth.
- An unsecured business equipment loan can provide funding between £1,000 - £500k
- Make regular payments in fixed monthly instalments at a small, pre-agreed interest rate
- Equipment loans can cover anything from specialist machinery to catering supplies
How long can you finance equipment?
The funding timeline for an equipment loan will depend on the cost of the equipment you are looking to purchase. We offer our clients the opportunity to finance equipment for a period of 1 - 3 years when they choose our unsecured business loans.
What are the benefits of business equipment financing?
The benefits of business equipment financing is that it is a more flexible form of finance, can improve cash flow and gives a company better purchasing opportunities. Furthermore, it’s quickly approved and in some cases is tax deductible, although you should check this through with your lender or credit broker.
There are so many benefits of choosing to finance equipment for your business, including:
- Flexible finance: A convenient solution to obtaining equipment whilst sticking to your business’ budget. You can choose how much you want to borrow, and for how long.
- Improved cash flow: By choosing business equipment finance, you will be able to preserve a large amount of working capital for the daily necessities of your business operations.
- Greater purchasing opportunities: Increased purchasing power will allow your business to access more equipment than you originally thought possible. You have the freedom to opt for higher-end, better quality equipment.
- Fast approval: Equipment finance can be obtained quickly. The application form can be completed in a matter of minutes soon after submitting you will hear from one of our account managers.
- Tax deductible: In some situations you could be eligible to deduct your monthly repayments, but check this through with your lender.
- Spread the cost: By taking out equipment financing, it can help spread the cost of expensive equipment into more manageable monthly payments.
Why choose us for your business’ equipment financing needs?
We care about your business and want to see it grow. Our experience as a credit broker and providing financial services means we understand how fundamental equipment is to running a small business. We offer our clients:
- Business equipment finance up to £500,000 in just 24 hours
- No fees to make an application or arrange the finance
- An unsecured business loan that will keep your business assets and equipment safe
- Trusted lenders who are authorised and regulated by the Financial Conduct Authority
- 256-bit technology to ensure that all applications are GDPR protected
How can I get business equipment financing?
When equipment breaks down, or you go through a period of increased demand, the last thing you want to be doing is waiting around to boost your supply. The finance you need to purchase business equipment could be yours in just 24 hours. Our online application form is easy for clients to complete, and we don’t wait to get in touch.
How to apply for Equipment financing:
Click apply now and fill in your business’ credentials - we will ask you how long you have been trading, how much on average you turnover monthly and the cost of the equipment you need financing.
Provide your full name, phone number and email address so that we can easily get hold of you.
Read through our terms and conditions and click ‘get my quote’.
From here, your application for equipment finance will be processed by an account manager who will find the most suitable option for your business.
Am I eligible for a business equipment loan?
To be eligible for a business equipment loan, your business must fulfill the following criteria:
- Have been actively trading for a minimum of 6 months
- Are registered in the UK by Companies House
- Have a £5,000 minimum monthly turnover
- Are over the age of 18
Frequently Asked Questions
If you have a question about business equipment financing that hasn't been answered, then make sure to look at some of the most frequently asked questions below.
What is business equipment financing?
Business equipment financing is used to help finance specific apparatus that a business needs in order to function. Often the equipment is specialist, therefore very expensive. This type of financing is very flexible and can help purchase a variety of items from office equipment to heavy machinery. Ultimately, suiting the needs of your business.
How can I get business equipment financing?
You can get business equipment financing by completing our online application. You will be required to answer some simple questions about your business and to provide relevant business documents. In addition, you’ll need to disclose some basic personal details and contact details. Once submitted, one of our broker’s will be in touch with you to discuss your loan request and other questions you may have.
Why choose SME Loans for business equipment financing?
At SME Loans, we understand that a business can’t properly function without the necessary equipment it needs. By working with a panel of trusted lenders, we can find a competitive loan needed to keep your business running. Our online application form is easy to complete and doesn’t come with any charges, making the process as smooth as possible.
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