As the name suggests, the loan availed for the specific purpose of availing equipment or a machine to add to the existing capacity or to start a new production line is generally termed as the equipment loan.
An equipment loan can be in the form of lease payments for equipment including financial lease, hire purchase arrangements, operational lease, and the like.
Just as small equipment loans are availed by homeowners for domestic appliances, SMEs and large enterprises also need to avail similar loans for the complex equipment required in the manufacturing, assembly, processing of the products before they reach the market.
The terms of equipment loans and the interest rates vary from one lender to another.
Reasons to prefer Equipment loan
Enterprises and business owners prefer equipment loans for various reasons, some of which are listed below:
- Down payment for the equipment can be as low as 5% of the value of the equipment
- Such loans are mostly collateral-free, unsecured loans
- Pre-approved
- Flexible repayment schedule
- Competitive interest rates
The equipment loans are offered by banks and NBFCs based on the requirements of the business owners and enterprises. The major types of equipment loans are loans for manufacturing equipment, IT and office equipment, construction equipment, corporate aviation equipment, medical equipment, electronics and appliances, and the like.
We are here to advise and assist with the process of availing the necessary finance as and when necessary. We provide innovative solutions to our clients to satiate their liquidity needs.
