Asset Finance — what you need to know

Asset finance allows businesses to fund the purchase of physical assets — vehicles, machinery, equipment, and technology — by borrowing against the value of the asset itself rather than against general business credit. Instead of paying the full cost upfront, you spread payments over an agreed term, keeping working capital free for day-to-day operations. Promise Money is an FCA-regulated whole-of-market broker arranging asset finance with no upfront broker fee.

Read the page or click the links below to jump to the section you need.

• What is asset finance?
• What types of asset finance are available?
• Hard assets vs soft assets
• How does asset finance work?
• What does it cost?
• Who can apply?
• How to apply

Want more detail? Read our The Asset Finance 100 — 100 questions and answers about asset finance.

What is asset finance?

Asset finance is a broad term for any funding arrangement where the asset being purchased acts as security for the loan. If the borrower cannot meet repayments, the lender can recover the asset. Because the loan is secured on something tangible, lenders can often offer more competitive rates and more flexible lending criteria than unsecured business loans. It is one of the most common ways UK businesses fund capital expenditure on physical assets.

What types of asset finance are available?

The main types are: Hire Purchase (HP) — you pay in instalments over a fixed term and own the asset outright at the final payment. Finance Lease — the lender owns the asset; you use it for most of its working life and receive a share of the sale proceeds at the end. Asset Refinance — release equity from assets you already own by using them as security for a new loan. For pure lease arrangements without a path to ownership, see our Lease Finance page.

Hard assets vs soft assets

Hard assets hold their residual value well and are straightforward for lenders to value and recover — examples include vehicles, plant, agricultural machinery, and manufacturing equipment. Most lenders will finance hard assets readily. Soft assets depreciate quickly or are difficult to resell — examples include IT hardware, software, and catering equipment. Fewer lenders cover soft assets and rates may be slightly higher, but specialist providers on our panel do accommodate them.

How does asset finance work?

You identify the asset you need and agree a purchase price with the supplier. Promise Money identifies the most suitable lender from our panel. The lender purchases the asset and makes it available to you — either for use under a lease, or with a path to ownership under hire purchase. You make fixed monthly payments over the agreed term. At the end, depending on the product, you own the asset outright or receive a share of its sale proceeds.

What does it cost?

Representative APRs for asset finance typically start from 5–9%, depending on the asset type, loan term, and your business credit profile. Hard assets generally attract lower rates than soft assets. Promise Money will provide a full cost schedule — showing total amount payable and monthly payment — before you make any commitment.

Who can apply?

Asset finance is available to UK-registered limited companies, sole traders, LLPs, and partnerships. Most lenders prefer a minimum of two years’ trading history, though start-up options are available through specialist lenders on our panel. Your credit profile and the nature of the asset will both affect which lenders are available to you.

How to apply

Complete the enquiry form on this page or call us on 01902 585020. There is no broker fee to businesses and no obligation at any stage. We will assess your asset, business profile, and funding requirement, then present clearly costed options from our lender panel. Subject to status. Your assets may be repossessed if you do not keep up repayments.

Promise Money is authorised and regulated by the Financial Conduct Authority (FCA Ref: 681423).

For more in-depth guidance, explore The Asset Finance 100 — expert answers to 100 common questions.