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Make the most of your assets

Asset Finance is an excellent way of assisting companies to acquire assets without putting a strain on working capital, explains Mike Oxby, Head of Asset Based Finance, Santander

Q: What is asset finance?

A: Asset finance can be structured to match the working life of the asset, with these repayments made over a defined period – typically three to five years – which greatly eases the task of budget management. It is a way to efficiently acquire an asset without adversely affecting cashflow. The key solutions available are:

Hire purchase: straightforward repayments over an agreed period of time
Finance lease: allows businesses to lease the asset over an agreed period with a choice of repayment options
Operating lease: residual value is built into the agreement, reducing monthly payments and increasing cash flow in to your business
Fleet management: including a range of value added services designed to maximise your fleet efficiency and productivity

Q: When would you recommend asset finance?

A: Businesses from Plcs to government bodies to start-ups benefit from accessing this product, across all sectors. I would recommend it to any business looking to invest in income-generating assets, whether production lines or vehicles for a fleet – any critical asset can be purchased in this way.

Q: What benefits does asset finance offer a business?

A: In the current economy, it is critical to preserve valuable working capital and maximise cashflow. This is the major core benefit of accessing this product, to any business. It means that the asset being acquired will effectively pay for itself as it generates income. Why pay for something up front when it will earn for the business over a period of time?

Q: Is there anything a business should think about before using asset finance?

A: It is important to understand what the asset will do for your business, how integral it will be to your operation. This will influence how we structure the finance. If it is a seasonal asset used in farming, for instance, we structure solutions to match the income the asset is generating. Also, maintaining comprehensive and up-to-date management and cashflow information should be a priority for any business.

Q: What does Santander’s approach offer?

A: Our approach means we work hard to understand exactly what our clients need, and then match the right products and solutions to these needs. We don’t just put a standard off-the-shelf product on the internet, we take a consultative approach and build a relationship. We can usually find a unique solution when one is required, including providing advice before the asset is purchased – engaging early means we can assist with other aspects, such as importing assets from overseas.

Want to find out more?

Santander is always happy to hear from businesses, to give advice and talk through finance options. If you want to find out more about asset finance, or any of the other services we offer, contact your local Relationship Director.

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John Carroll - Helping businesses achieve International success. Head of Product Management & International Business, Santander UK