In the realm of business finance, business asset finance stands out as a popular and effective method for companies to acquire the equipment and machinery they need. But what exactly is it, and how has it been performing in the UK in 2023?
What is business asset finance?
Business asset finance refers to a financial arrangement where companies can obtain equipment, vehicles, or machinery without the need for an outright purchase. Instead, they can lease, hire, or purchase these assets through various financing agreements, facilitated by asset finance brokers.
What can business asset finance be used for?
Business asset finance can be utilised for a wide range of assets essential for the operation or expansion of a business. This includes but is not limited to, vehicles, IT equipment, machinery, and even office furniture. It provides businesses with the flexibility to upgrade or expand without significant capital outlay.
What are examples of asset financing?
There are several types of asset financing, including:
Hire Purchase (HP): Where a company agrees to pay for an asset in instalments. Once the final payment is made, the company owns the asset.
Leasing: This involves renting the asset for a period, after which the company can choose to purchase, return, or continue leasing it.
Asset Refinance: This involves using assets the company already owns to secure additional funding.
Can you get asset finance with bad credit?
Yes, while having a good credit score can make the process smoother, many asset finance brokers offer solutions tailored for businesses with bad credit. It's essential to demonstrate the ability to meet repayment terms and provide a sound business plan.
Is asset finance easy to get?
Asset finance is generally more accessible than traditional bank loans, especially with the rise of asset leasing and alternative finance providers. The approval process is often quicker, with fewer stringent requirements, making it a preferred choice for many businesses.
What have the growth rates in the UK been like in 2023?
In 2023, the UK witnessed a significant uptick in asset finance. New figures from the Finance & Leasing Association (FLA) reported a 12% growth in new business in April 2023 compared to April 2022. The first four months of 2023 saw a 13% increase in new business compared to the same period in 2022, indicating a robust and growing market.
In conclusion, business asset finance offers a flexible solution for companies looking to acquire or upgrade their assets without hefty upfront costs. With the continued growth witnessed in 2023, it's evident that more businesses are recognising its benefits. For those seeking expert guidance in this domain, a fully flexible financial business consultant service can provide invaluable insights and support.