Small businesses would prefer to lease equipment rather than get a bank loan to buy it outright, a new survey has found. Leasing or hiring has replaced bank loans as the second most popular form of Finance ( after cash ( for small businesses buying equipment, the report found.
Bank loans proved particularly unpopular among smaller companies spending up to pounds 5,000 on new equipment, where just under half said they preferred to use cash instead. The survey, by Forum of Private Business (FPB) and the Finance & Leasing Association (FLA), showed the preferred sources of funding were similar for purchases of between pounds 5,000 and pounds 25,000.
But for larger investments, of between pounds 25,000 and pounds 100,000, Asset Finance was the preferred option, used by just over half of SMEs. Meanwhile the report found that over the last year, Information Communication Technology (ICT) ( computer equipment ( is the Asset most heavily invested in by SMEs.
The top three investments were in computer hardware followed by software ( both invested in by around two thirds of SMEs ( followed by printers at just under half. The most popular investment in non-ICT equipment was in cars, which found favour with a quarter of SMEs, and machine tools, with 20%.
This new research shows what a vital contribution Asset Finance plays in funding SME investment.
Asset-Finance.org.uk specializing in asset based finances provide you information and advice on some of the follwoing issues related to Asset Finance:
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