How To Make The Most Of Equipment Financing
Machinery, just like everything else, has a shelf life and every business owner needs to allocate enough money to ensure that the machines and equipment being used in the production process isn’t obsolete or inefficient. Acquiring new machinery can be costly and can put a strain on your business finances. The final cost of the machinery will be pushed higher with the addition of transportation and installation charges, which are typically not included in the invoice.
Further, sometimes new technology presents a different way of creating the same product with higher efficiency and perhaps by shortening the production time. Such a scenario entails not just the cost of new equipment, but also expenses required to adapt the production process to the new technology. Often, the need for major maintenance also uses up a large fraction of the total equipment cost.
To meet any or all of the above needs, it may be that the business doesn’t have enough cash reserves even though it may be flourishing. In such cases, it is best to get an equipment financing to enable the business to leap into the next level without having to pare down or postpone its growth plans.
Think About Equipment Financing
Equipment financing is used to replace, change, upgrade, maintain or repair the machinery that makes your business run. When mulling over applying for a machinery loan, also consider that your additional outlay will include the interest component apart from repayment of the principle amount. Further, lenders may not provide funding for the entire cost of the machinery. Be prepared to invest up to 20% of the cost of the machinery from internal accruals.
Here are a few advantages which stand out in favour of equipment financing:
- An equipment machinery loan will help your business manage costs, allowing you to repay the loan in manageable EMIs, thus making it easier to manage cash flow.
- Many times, a business owner will overlook the most up-to-date equipment as the cost is beyond what the business can afford at the time. With equipment finance, you will be able to provide the edge your business needs by buying the latest and best equipment to ensure speed and quality.
- With equipment financing, you will have the option to buy the best machinery, helping you get ahead of competition.
These are some of the features of a customised equipment machinery loan:
- Quick approval in 24 hours
- No need for collateral as security
- Minimum documentation and easy eligibility
- Loans up to Rs.30 Lakh
- Nominal interest
A machinery loan will offer you enough flexibility in repayment options including part-prepayment and collateral free loans. When you are shopping for the right machinery loan to fulfil your needs, consider the hassle-free online application process and minimal documentation that equipment machinery loans from Bajaj Finserv offer. You can borrow any amount between Rs.3 lakh and Rs.30 lakh at a tenor between 12 months and 96 months at a fixed and affordable rate of interest.