Obtaining finances for your business is not straight forward especially in the hardest economic times this country has seen since the financial crisis. Understanding the main types will go a long way towards helping you decide the best place you should start your search for financing. For business owners, the government support in the form of Bounce Back Loans and the CBILS is rounding down. Which leaves the Banks. But not all business will qualify. Banks will be hesitant to lend money, especially to start-ups and small businesses that don’t have guarantee of profitability or companies who are experiencing rapid growth/loss pre-pandemic. With GRENKE, businesses needn’t worry. We can provide alternative financial solutions that may offer better rewards..
Spotting the difference
We often get asked the difference between a standard bank loan and alternative asset finance products. Businesses use asset finance as it doesn’t reduce the likelihood of them being able to borrow money elsewhere, it’s a contractual agreement rather than an outstanding loan balance.
We have taken the time to detail the main differences between a bank loan and leasing.
1. Rates.
Banks rates are usually floating and based on indexes. As the index fluctuates so does the monthly payment. With GRENKE leasing, payments are generally fixed for the term of the lease. Fixed payments make budgeting and cash flow management much easier.
2. Amount Financed.
Banks generally lend a portion (60%-80%) of the equipment cost; exclusive of soft costs such as shipping, training, installation, etc. Leasing allows up to 100%.
3. Available Terms.
Banks tend to be less flexible than leasing companies. That is okay if you are looking for a standard term but not so good if you need flexibility. GRENKE’s leasing repayments are managed and are personal to the individual, all arranged to work alongside you, the lessee.
4. Ease of application.
Working with banks are generally more time consuming, require lots of paperwork and numerous meetings. Our team offer a personal, and local service with 10 branches across the UK. Your request is reviewed and agreed by a member of our team, no computers, just a common sense approach to your finances.
Leasing allows businesses to use the equipment they need, without denting precious cash flow in the process. Business can spread the cost of necessary equipment and their transactions schedules can be tailored to their needs and wants, including the repayment amount and the length of the terms.
You can lease almost anything with GRENKE. Start your leasing journey today.
