Asset finance lets you spread the cost of equipment, vehicles, or machinery over time, rather than paying for it outright. The asset itself usually secures the finance, which often means more competitive rates than an unsecured loan, and it keeps your working capital free for the rest of the business.
We’ll help you compare the different structures available and match you with a lender who understands the type of asset and sector you’re working in.
| Structure | Ownership | Best Suited To |
|---|---|---|
| Hire Purchase | You own the asset once all payments are made | Businesses wanting to own equipment outright eventually |
| Finance Lease | The finance company retains ownership | Businesses preferring to lease rather than own |
| Operating Lease | The finance company retains ownership, shorter term | Assets that need regular upgrading, such as technology |
UK asset finance new business tops £40 billion a year, according to the Finance & Leasing Association, covering everything from company vehicles and IT equipment through to heavy plant and manufacturing machinery. It’s one of the most commonly used forms of business finance in the country, precisely because it matches payments to the useful life of the thing you’re actually buying.
We compare terms across a range of asset finance providers, including:
Terms typically run from one to seven years depending on the type of asset and its expected working life, with shorter terms common for technology and longer terms for heavier plant and machinery.
A groundworks contractor needed to replace two ageing excavators before a large contract started. Buying outright would have used most of their available cash. We arranged hire purchase finance over five years, matched to the expected working life of the machinery, so they owned the equipment outright by the time it would typically need replacing.
A professional services firm wanted to refresh its IT equipment across the business but knew technology would need replacing again within a few years. We arranged an operating lease, giving them access to current equipment with a straightforward route to upgrade at the end of the term, rather than being left holding outdated kit.
It depends on the structure. Hire purchase leads to ownership once all payments are made, while finance leases and operating leases mean the finance company retains ownership throughout, and often afterwards. We’ll help you choose based on whether ownership actually matters for that particular asset.
Yes, many lenders will finance used or refurbished assets, though terms and rates can differ from new equipment, partly reflecting the asset’s expected remaining working life.
Asset finance is secured specifically against the asset being purchased and is tied to that item, while a business loan is more flexible and can be used for a wider range of purposes. Asset finance often carries a more competitive rate given the built-in security.
As with any secured finance, missed payments can lead to the asset being repossessed, since it’s the security for the agreement. If your circumstances change, it’s always worth speaking to your lender early rather than letting missed payments build up.
