Why Asset Finance?
Cash flow is king in any business and having to fund the purchase of business assets can be a serious drain on working capital. Most businesses at some time require equipment such as vehicles, computer systems, or equipment for a specialised industry. This is where flexible business asset finance can help you benefit from the asset needed without tying up valuable working capital in it. You are then able to spread the cost of the acquisition over the life of the asset, retaining vital cash reserves in the business for other necessary expenses such as wages, heat, light and power etc.
Quintessential Finance provides an alternative to the high street banks which often lack the flexibility to provide a viable funding solution to most business users needs
OVERVIEW OF ASSET FINANCE
Features:
• Security is primarily taken on the asset concerned and is generally a stand-alone facility. The cost is spread over a period up to the useful life of the asset.
• Assets that can typically be funded in this fashion are generally of a tangible nature with a readily available resale market.
Benefits:
• The cost of the asset can be linked to the income stream it generates.
• Relatively straightforward facility to arrange.
• The rental profile is agreed at inception allowing simple cash flow management.
• It is a stand-alone facility that leaves other lines of credit intact for working capital.
• Unlike an overdraft, asset finance is generally non-cancellable providing the agreement is maintained correctly.
Bank Borrowing v's Asset Finance
Bank Borrowing |
Asset Finance |
| No fixed interest rate | Fixed rates regardless of LIBOR |
| Loan tied in with your banking commitments | Finance kept separate from core banking arrangements |
| Using variable credit lines | Availability of additional credit lines |
| Often personal / assets charages taken | No security over your existing assets |
| All your borrowings viewed in one facility | Ability to utilise other sources of funding |
| Loan may be payable on demand | Term fixed |
| Offer general banking services | Specialise in particular types of assets |
