Have you considered asset finance to fund your business growth?

Since 2015 Close Brothers has successfully helped SMEs across the UK recruit and train a new generation of apprentices through its SME Apprentice Programme. In partnership with the AMRC Training Centre, the programme contributes to the funding of new apprentices in the manufacturing sector in and around the Midlands, helping local businesses secure the skills they need for the future. 

For over 40 years, they have been supporting businesses through the provision of asset finance, an alternative form of funding used by business owners to obtain the equipment and machinery they need to grow or access much-needed cash. Close Brothers states asset finance makes the otherwise unaffordable affordable because it provides access to equipment without incurring the cash flow disadvantage of an outright purchase, while agreements can also be customised, with flexibility on both the term and
repayment schedule.

In this article, Close Brothers explains more about three key products:

• Finance lease
• Refinance
• Hire purchase

Finance lease
Think of finance lease as a long-term rental for business assets (or equipment, which is the same thing). Instead of buying the asset upfront, you pay rent to use it, with a flexible rental period to match your needs and cash flow fluctuations, which we know can change month-to-month. You cover the cost of the payments, including the agreed interest, for the duration of the rental period. 
At the end of the initial lease, you have various options available to you: 
1. Keep on using: continue leasing the asset by extending the rental period – otherwise known as a 'secondary rental period'. 
2. Sell and earn: you can sell the equipment and keep a share of what the asset is sold for.  
3. Return: give the equipment back if you no longer need it or want to upgrade to something newer.   

Who is finance lease for? 
Finance lease is for businesses that need equipment but prefer not to purchase it outright. It's suitable for companies looking to use assets like machinery, vehicles, or technology without a large upfront cost. Whether you're a small engineering firm needing a second-hand CMC machine or a larger operation needing specialist equipment, finance lease offers flexibility by allowing you to pay for the equipment over time while having the option to keep, sell, or return it at the end of the lease term. 

Refinance
Refinancing uses the value of assets you already own to help your business. With Sale and HP Back – a type of refinancing – you sell your equipment to us, and we lend you the money you need to invest in your business. You pay us back in line with what the equipment earns for you. Once you’re done paying us back, you own the equipment again. This works whether you own the equipment outright or are already financing it with someone else.  

Who is refinancing for?  
Refinancing is for anyone looking to unlock the value of their existing assets to support their business. Whether you own equipment outright or are financing it elsewhere, refinancing can provide a quick way to access funds for things like new equipment, improving cash flow, or other business needs. It’s a flexible option suitable for businesses of all sizes, including sole traders. 

Hire purchase
Hire purchase is the smart way to get what you need because: 

• You get to choose, use and manage the assets you need for your business over an agreed period, typically up to five years. 
• The regular instalments you pay as part of your agreement will cover: 
  • The asset's depreciation.
  • Interest on the cost of the asset.  
• At the end of the term, you get to choose to buy the asset and own it outright.  

Who is hire purchase for?  

Hire purchase is especially handy for:  

• Businesses who want to keep control of their cash flow by knowing what their investments are going to cost them over the long-term, allowing them to budget effectively. 
• Purchasing ‘hard’ assets like vehicles, machinery, equipment and other assets with resale value.   

For more detailed information and to get in touch, please visit What Is Asset Finance?.