Our guide on business cashflow finance will be answering the following question: “Asset Finance – What is Leasing & Hire Purchase?”
Leasing and Hire Purchase are two of the most popular forms of finance in the UK, behind only bank overdrafts and credit cards in terms of S.M.E use.
They allow businesses to obtain equipment, machinery or other business assets without large upfront costs that can put a strain on cashflow and working capital.
Hire Purchase contracts usually involve a deposit and fixed payments over an agreed term.
A Lease (either a Finance or Operating Lease) allows the business to use the asset in exchange for rental payments, which may include an advanced rental, over an agreed period.
What is Hire Purchase?
Hire Purchase is where the borrower agrees to purchase an asset from the lender over a specified period. You own the item at the end of the contract. Usually, there is a small fee at the end of the contract to secure title to the asset
What is Leasing?
A Finance Lease works as a rental agreement. The business will agree to a fixed or minimum term rental period for an asset and make regular rental payments for the duration of the lease contract. At the end of the agreement, the business may have an opportunity to continue renting or to return or possibly exchange the asset.
94% of Asset Finance applications are successful
(British Business Bank Small Business Finance Markets report, 2017)
If you’d like to arrange a no obligation exploratory call to discuss, please get in touch.
Hadrian Finance Business Solutions
We will provide you a fast, competitive quote to lease any capital equipment necessary for the running of your business. This includes Plant, Vehicles, Production Equipment, IT and Telecoms Systems and even ‘Small Ticket’ items down to £2K in capital value
Leasing is a tax and cash efficient way of financing equipment for your business, it keeps the asset ‘off balance sheet’ and offers the following key benefits:
- It provides you immediate use of the asset without paying for it all at once.
- It frees up working capital and bank loan / overdraft facilities for business growth.
- The Lease contract is structured for the length of time you require use of the asset .
- Sale & Leaseback allows you to release capital in assets you already own.
- We can provide a solution irrespective of credit history or previous problems.
- It offers the most tax efficient structure for your business.
Whatever your requirement for asset, machinery or vehicle leasing consult our expert team for a no obligation discussion, best advice and generally a same day quotation. Please call us today to see how we can help or submit an enquiry and we will contact you.