Compare equipment finance options for your business

For some businesses, a wide range of equipment and machinery is essential to ensure financial success. Whether it’s heavy machinery, specialized medical equipment or the latest IT devices, equipment finance from a lender can give you access to the funds you need to help your business acquire what it needs to continue running.

What is equipment finance and who offers it?

Equipment finance is designed to give you access to the funds you need to purchase essential specialized equipment for your business. Whether you’re looking to purchase a forklift to move goods in your warehouse or new X-ray machines for your dental practice, equipment finance is on hand to help.

A large number of lenders offer equipment finance, though there is a range of options borrowers can choose from. However, choosing the best approach for your business will depend on a range of factors including your financial situation, taxation needs and budget.

Top business lenders you can compare

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Name	Product	Filter Values	Loan amount	APR	Requirements
First Down Funding business loans			$5,000 – $300,000	Fee Based	At least 1 year in business, an annual revenue of $100,000+, and a minimum credit score of 400	Alternative financing up to $300K with highly competitive rates.	Check eligibility More Info		loading Fetching your data…
Lendio business loans			$500 – $5,000,000	Starting at 6%	Operate business in US or Canada, have a business bank account, 560+ personal credit score	Submit one simple application to potentially get offers from a network of over 300 legit business lenders.	Check eligibility More Info		loading Fetching your data…
ROK Financial business loans			$10,000 – $5,000,000	Varies	Eligibility criteria 3+ months in business, $15,000+ in monthly gross sales or $180,000+ in annual sales	A connection service for all types of businesses — even startups.	Check eligibility More Info		loading Fetching your data…
OnDeck small business loans			$5,000 – $250,000	As low as 9.99%	600+ personal credit score, 1 year in business, $100,000+ annual revenue	A leading online business lender offering flexible financing at competitive fixed rates.	Check eligibility More Info		loading Fetching your data…
Rapid Finance small business loans			$5,000 – $1,000,000	Fee based	Steady flow of credit card sales, bad credit OK	Check eligibility More Info		loading Fetching your data…
Fundbox business loans			$1,000 – $100,000	4.99	You must have an established business.	Get flat rate, short-term financing based on the financial health of your business, not your credit score.	Check eligibility More Info		loading Fetching your data…
Kickpay e-commerce business loans			$20,000 – $1,000,000	Not applicable	At least $250,000 in the past 12 months of revenue, e-commerce business, use a 3rd party fulfillment center for storing and shipping inventory, at least one US location.	Get a loan for your e-commerce business based on your sales history.	Check eligibility More Info		loading Fetching your data…
LendingClub business loans			$5,000 – $500,000	12.15% to 29.97%	12+ months in business, $50,000+ in annual sales, no bankruptcies or tax liens, at least 20% ownership of the business, fair personal credit score or better	With loan terms that vary from 12 to 60 months, enjoy fixed monthly payments and no prepayment penalties through this award-winning lender.	Check eligibility More Info		loading Fetching your data…
Monevo business loans			$500 – $100,000	3.99% to 35.99%	Credit score of 500+, legal US resident and ages 18+.	Use this connection service to get paired with a loan you can use for business.	Check eligibility More Info		loading Fetching your data…

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How does equipment finance actually work?

Equipment finance gives you access to whatever important business equipment you need without having to pay for it upfront. Instead, you can receive the funds you need from a lender and then pay off your purchase over a set repayment period.

In other words, you get all the benefits of ownership before you actually own the equipment. However, there are several different financing routes you can choose to go with, including taking out a loan or a finance lease. Read on to find out more about how different types of equipment finance work.

Want to finance a business vehicle? Compare your options here

How can I finance my business equipment purchase?

• Commercial loan or equipment loan. This is probably the type of finance most borrowers are familiar with. As a secured loan, the asset you wish to buy will be used as security for the loan. This means that you own the item in question and can claim any interest charges and depreciation of the asset as tax deductions.
• Finance lease. A finance lease involves a lender purchasing the asset you want and then renting it out to a business for an agreed period. You can choose from flexible repayment terms to fit your budget, while the lease payments you make are usually tax deductible.
• Business credit cards. Depending on the type of equipment you’re purchasing, you might want to use a business credit card, Business credit cards offer a few advantages. For example, you can get an interest-free period on purchases using a 0% APR business card.

Compare equipment loans vs. leases

How do I compare lenders that provide equipment finance?

• Find out the interest rate. The interest rate offered will obviously influence how much you pay over the life of your loan, so look for one that offers a low rate of interest. You’ll also need to consider whether you want the security of a fixed rate or the possibility for saving that a variable rate offers.
• Compare the fees and charges. Whenever you sign up for any financial product, it pays to make sure you’re aware of all the fees and charges attached to the deal. Read all product information closely to know if the finance option you choose attracts fees such as an establishment fee or an early repayment fee.
• Establish if there are any taxation benefits. The range of equipment finance options are assessed differently when tax time rolls around. Each approach has its own potential tax benefits, so seek advice from your accountant to learn which one suits you best.
• What are the loan terms? How long can you take to pay off your asset? Terms typically range from one to seven years, so look for equipment finance that offers a term suited to your financial situation.
• Are there flexible repayment options? How often does each vehicle finance option let you make repayments? Look for a solution that lets you schedule your repayments in a way that suits your budget.

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The good and not-so-good of equipment finance

What should I consider avoiding when it comes to equipment finance?

The main pitfall to avoid with equipment finance is getting into a financial agreement that you simply cannot afford to service. It’s important to consider how essential any equipment is before you commit to a purchase, as well as make sure you’re aware of your ability to make repayments on time.

Another common issue is that some people can get confused by is the array of equipment finance options available. Seeking assistance from your accountant is one way to go to ensure you make the right choice.

Frequently asked questions