Asset Finance is a financing option that enables businesses to acquire essential assets and equipment without the need for a large upfront payment. Instead of purchasing the asset outright, businesses make regular payments to use it over an agreed-upon period, avoiding the full cost of buying it outright.
Asset Finance is crucial in the construction industry because a lot of the machinery and equipment that is needed to do their work can be expensive and unobtainable for many businesses. Waiting to accumulate enough cash to purchase an asset can slow construction projects and complicate daily operations. Therefore, many construction businesses use Asset Finance to allow them to acquire the assets they need while keeping cash in their business. In 2024, Asset Finance has been on the rise in the construction sector. In fact, new figures released by the Finance & Leasing Association (FLA) show that total plant and machinery finance (primarily leasing and hire purchase) grew in April 2024 by 9% compared with the same month in 2023.
How can asset financing benefit construction businesses?
At Time Finance, we can offer three flexible asset finance options to our intermediaries, including hire purchase, refinance, and finance lease. Utilising our Asset Finance options offers several benefits to construction businesses.
Flexible repayment plans: Construction equipment can be very expensive. Asset Finance allows you to avoid paying for an asset outright. Instead, you can spread the cost over monthly payments, this can help to maintain a healthy cash flow for your business and keep control over working capital.
Access to the latest technology: Asset Finance allows you to grow without the limits of saving up to purchase an asset. It means you can access the latest equipment and technology when you need it, giving you an edge over your competitors.
Tax benefits: Many construction businesses can benefit from the tax advantages associated with asset financing. By utilising Asset Finance, businesses can take advantage of VAT deferrals, allowing them to pay VAT at a later date. This approach helps reduce upfront costs and improve cash flow management for any construction business looking to finance machinery.
Support seasonal lows: As the construction industry slows down during the winter period, we can provide a refinance solution to release cash held in the value of machinery you already own.
Control: Construction projects vary in size and duration. Asset Finance gives you more control of your working capital and cash flow, allowing you to scale up or down based on project requirements without significant capital investment.
What construction assets can be financed?
Using an Asset Finance solution makes it possible for construction businesses to plan ahead and they have all the resources necessary for completing their contractual deadlines. Typical construction assets that are eligible for financing consist of:
- Excavators
- Access lifts
- Crushers
- Loader
- Screeners
- Bulldozers
- Dumpers
- Demolition equipment
- Construction vehicles
- Site plant
What funding can construction businesses take advantage of:
At Time Finance, we provide funding solutions that give businesses the confidence and freedom to achieve their business goals. Running a construction business can be extremely challenging, so we bring solutions delivered with expertise and flexibility. Whether you need a cash injection to help with cash flow or you are looking to acquire a new piece of machinery to keep your business running smoothly, we can help. Through our intermediaries, we offer construction businesses a range of flexible funding solutions. Choose from the variety of finance options we offer, such as:
Asset Finance
Business Loans
Asset Based Lending