How asset finance can help you grow

Read time: 2 mins        Added date: 20/10/2023

It’s good to understand your finance options when you’re growing your business, and what they involve.

Asset finance can help you take the exciting steps to grow your business. But how exactly does it work and is it right for you? Learn more about the benefits of asset finance to see if it could be a good move for your business. 

Growing your business with asset finance

Growing your business takes time and money. However, you might not have the cash to buy the vehicles, machinery or equipment you need.

Perhaps you want to increase the range or volume of products you offer or sell them from multiple locations. This can mean having to buy additional equipment, extra vehicles and invest in new machinery – which all adds up to a significant investment.

Asset finance can give you a flexible way to scale up quickly through monthly payments rather than paying for it all upfront.

Whatever growing your business looks like to you, asset finance can be a great way to invest in its future.

What is asset finance?

Asset finance is a way to borrow money to cover the costs of buying new assets for your business. This could include financing machinery, equipment and vehicles.

Asset finance allows you to pay a deposit and borrow the rest. You can repay this back in monthly instalments (including interest) over a set period of time. You can then pay an option to purchase fee at the end to transfer ownership of the asset to you.

By borrowing money, you’ll avoid paying out a large sum in one go and tying up all your working capital. It also simplifies cash flow as you can include fixed monthly payments in your forecasts knowing exactly how much they’ll be.

Benefits of asset finance

  • Access new vehicles, equipment and machinery.
    With asset finance you can use the latest equipment or machinery straight away which could help improve efficiency or give you a competitive advantage.
  • Frees up cash reserves
    By using asset finance you won’t tie up valuable cash reserves in your assets, leaving money for use elsewhere.
  • Rent your assets. 
    You might not want to own your assets in the long-term. Paying a monthly amount would enable you to effectively ‘rent’ them for as long as you need them.
  • Tax benefits. 
    There may be some tax benefits to financing your assets. For instance, under the Full Expensing Scheme you can deduct the value of qualifying assets from your profits before tax.

What kinds of assets can you finance?

Assets are any item of value your business owns. The types of assets you need to grow your business will depend on the sector you operate in. You might want to use asset finance for assets such as:

  • Transportation – you may want to upgrade or expand your fleet of HGVs, coaches and more, supporting business growth. You could also use business car finance if you need new company cars.
  • Agriculture – growing your farming business could mean you need to invest in new equipment like tractors or combine harvesters. You might also want to finance process improvements such as introducing automation or green machinery.
  • Manufacturing and construction – new equipment, plant machinery and production tools cost a premium. Equipment financing can help spread the cost of these upgrades.
  • Renewables – more businesses are going green. Keep pace with your rivals by investing in planet-friendly technology such as biomass boilers, solar panels and new heating systems.

What financing options are available?

There are different asset finance options depending on what’s right for you and your business.

Hire Purchase

With Hire Purchase, the lender purchases your assets and you lease them – making regular monthly payments over a set period of time. Once you have paid off the cost of the asset and the interest, you can pay a purchase fee to own it outright.

Finance Lease

With a Finance Lease, the lender purchases your assets for you and then leases them back to your business. At the end of the agreement, you can select to extend it or sell the asset and receive a share of any surplus proceeds. Like Hire Purchase, this may be offered on things like equipment and vehicles.

Vehicle Contract Hire

Vehicle Contract Hire can be a cost-effective way to lease cars and vans. You pay an initial sum, followed by monthly amounts. At the end of the rental period, you can select to extend it or return the vehicle.

Asset Refinance

Asset refinancing – or Sale and Hire Purchase Back – can help release funds back into your business. If you have recently purchased an asset, the lender buys this from you and then finances it back to you under a hire purchase agreement. You make regular monthly payments and at the end of the agreed term you own the asset again.

Green Asset Finance

Green Asset Finance can help you buy energy-efficient equipment or electric vehicles to grow your business and meet your sustainability targets.

Is asset finance right for me?

It can vary from business to business. It’s important to be sure you can cover the cost of repayments, whatever type of asset finance agreement you sign up for.

You may also want to think about the following before agreeing to any terms:

  • Do you want to own the asset at the end?
  • What is the expected useful life of the asset? This can help you work out how long you want to finance it for.
  • Do you want to buy new or used?
  • Are you happy to pay a deposit?

Grow your business with flexible asset finance


Asset finance can be a simple way to fund what you need now, helping to grow your business for the future. It allows you to spread the cost of the new assets, without having to pay upfront or access other types of secured or unsecured lending.

Paying monthly helps you manage your business’s cash flow and means you’re not tying up large sums of money that could be needed elsewhere. Asset finance can also offer flexibility – particularly if you don’t want to own the assets in the long-term.

Explore asset finance

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Important legal information

Lloyds Bank is a trading name of Lloyds Bank plc, Bank of Scotland plc, Lloyds Bank Corporate Markets plc and Lloyds Bank Corporate Markets Wertpapierhandelsbank GmbH.

Lloyds Bank plc. Registered Office: 25 Gresham Street, London EC2V 7HN. Registered in England and Wales no. 2065. Bank of Scotland plc. Registered Office: The Mound, Edinburgh EH1 1YZ. Registered in Scotland no. SC327000. Lloyds Bank Corporate Markets plc. Registered office 25 Gresham Street, London EC2V 7HN. Registered in England and Wales no. 10399850. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority under registration number 119278, 169628 and 763256 respectively.

Lloyds Bank Corporate Markets Wertpapierhandelsbank GmbH is a wholly-owned subsidiary of Lloyds Bank Corporate Markets plc. Lloyds Bank Corporate Markets Wertpapierhandelsbank GmbH has its registered office at Thurn-und-Taxis Platz 6, 60313 Frankfurt, Germany. The company is registered with the Amtsgericht Frankfurt am Main, HRB 111650. Lloyds Bank Corporate Markets Wertpapierhandelsbank GmbH is supervised by the Bundesanstalt für Finanzdienstleistungsaufsicht.

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