When your business needs new equipment, like new vehicles or machinery, but your cash flow is tight, asset finance could be a solution worth exploring.
This finance option allows your business to acquire essential assets without the large upfront costs. This helps you to maintain your working capital while still getting the tools you need to grow.
Please note that this blog is not intended to give advice, but to share information.
The Basic Asset Financing Process
At Finch Financial Asset Finance, we follow a straightforward 4-step process that typically takes a few days to complete.
We guide you through each step, so you benefit from our years of experience, as well as the relationships we have built with finance providers.
Step 1: Choose Your Asset
Select the equipment, vehicle or machinery your business needs. This could be anything from office computers & manufacturing equipment, to delivery trucks & construction machinery.
Step 2: Apply for Finance
We’ll complete your application with your business information and details about the asset you want to purchase. Our experienced team will then pre-assess your application and recommend the best lender to approach based on your circumstances. Typically, applications can be completed with one of our friendly brokers in under 30 minutes.
Step 3: Get Approved
Your chosen lender will then assess your application based on your business’s financial health and the asset’s value. Many applications receive approval within 24-48 hours.
Step 4: Purchase Your Asset
Once approved, the finance provider purchases the asset on your behalf. You will now need to begin to make regular repayments and use the equipment to generate income for your business.
The entire process typically takes 1-5 business days from application to asset delivery, making it one of the fastest ways to acquire business equipment.
Types of Assets You Can Finance
Asset finance is very versatile, covering a wide range of business asset that holds value, including:
- Equipment and Machinery: Manufacturing equipment, kitchen appliances for restaurants, medical devices, IT equipment, and specialised tools for trades.
- Vehicles: Delivery vans, company cars, trucks, trailers, and even specialised vehicles like food trucks or mobile service units.
- Technology: Computer systems, servers, software, point-of-sale systems, and telecommunications equipment.
The key requirement from lenders is that the asset must have a clear resale value and be essential to your business operations.
Key Benefits of Asset Finance
Understanding the reasons why businesses choose the various asset finance options over other funding options can help you understand the strategic advantages this financing method offers.
While Asset Finance helps your business to acquire equipment, it’s often also a smart financial decision that supports your business’s growth and stability.
Here are the primary benefits that make asset finance an attractive option for Australian businesses:
- Preserve Cash Flow: Instead of paying a large sum of money upfront, you spread the cost over time while the asset generates income immediately.
- Tax Advantages: Depending on the finance structure you select, you may be able to claim tax deductions for repayments and/or depreciation. Some assets may qualify for the instant asset write-off scheme.
- Quick Access: You get the assets you need fast without lengthy approval processes that are common with traditional loans.
- Flexible Terms: Repayment periods typically range from 12 months to 7 years. This allows you to match the repayments with the asset’s productive life.
- Retain Working Capital: Keep your cash reserves available for day-to-day operations, unexpected opportunities, or emergencies.
Who Can Apply for Asset Finance
Asset finance is available to most Australian businesses, including:
- Sole traders and partnerships
- Companies and trusts
- Startups with solid business plans
- Established businesses looking to expand
Lenders typically look for businesses that have been operating for at least 6-12 months, though at Finch Financial, we have good relationships with lenders who are willing to consider newer business lending.
Your credit history matters, but the asset itself provides security. This makes approval more accessible than with unsecured business loans.
Getting Started with Asset Finance
When you’re ready to explore asset finance for your business, the first step is identifying which assets would most benefit your operations and growth plans.
Take into consideration equipment that will increase productivity, reduce your costs, or enable you to take on new business opportunities.
At Finch Financial, we specialise in helping Australian businesses find the right asset finance solution for their needs. Our experienced team can guide you through the entire process, from initial consultation to final approval.
Contact us today to discuss your asset finance needs and discover how we can help your business acquire the tools for success.
Frequently Asked Questions
What is asset finance?
Asset finance includes various lending structures that allow businesses to acquire equipment, vehicles or machinery, and spread the cost over time through finance repayments, rather than paying upfront for the asset.
How long does approval take?
Typically, asset finance applications with Finch Financial are processed within 24-48 hours, and the funds are available to your business within 1-5 business days.
What assets can be financed?
Almost any business asset with resale value can be financed. This includes equipment, vehicles, machinery, and technology.
Do I need a deposit?
Deposit requirements vary by lender and the type of asset. Many asset finance options are available with either a low or zero deposit.
What are the typical interest rates for asset finance?
Interest rates vary based on various factors. Business creditworthiness, asset type and the loan term will all be taken into consideration when the lender offers their interest rate terms.
Contact the team at Finch Financial for current rates tailored to your situation.