What is asset finance and how does it work?

Asset finance is funding that lets a business acquire equipment, vehicles or machinery, or release cash from assets it already owns, while spreading the cost over time. You typically pay a deposit and regular instalments, and the asset itself usually acts as security for the finance.

What is the difference between hire purchase and leasing?

Hire purchase spreads the cost of an asset and lets you own it once all payments, including any option-to-purchase fee, are made. Leasing rents the asset for a term, usually at a lower monthly cost, but you generally do not own it at the end unless a specific option is agreed.

Who are the biggest asset finance providers in the UK?

Lombard, Close Brothers and Aldermore are among the larger and most active asset finance providers, alongside specialist banks such as Paragon and independents such as Time Finance and Novuna Business Finance. The best fit depends on your asset and profile rather than size alone.

Is asset finance cheaper than a bank loan?

Asset finance can be cost-effective because the asset provides security, which may mean a lower rate than unsecured borrowing. Pricing varies by profile, asset and structure, so compare the total amount payable across the term and confirm current terms with the provider.

Can I get asset finance with bad credit or a new business?

It can be possible, because some independent funders and specialist lenders price for risk and consider newer or harder-to-place cases. Expect a higher cost, a larger deposit or a personal guarantee, and compare options before committing.

What assets can be financed?

Hard assets such as commercial vehicles, plant, machinery, agricultural equipment and manufacturing kit are the most commonly financed. Softer assets such as IT, software and fit-outs can sometimes be funded, though appetite and terms vary by lender.

What is asset refinance?

Asset refinance, sometimes called sale and leaseback, releases cash from equipment your business already owns by using it as security for a new agreement. It can free up working capital, though you take on repayments against an asset you previously owned outright.

Should I use a broker or go direct to a lender?

Going direct works if you already know which lender suits your asset and profile. A whole-of-market broker can compare multiple providers at once and match your situation, which can save time and surface options you might not find alone.

Best Asset Finance Providers in the UK

The best asset finance provider in the UK depends on your asset type, ticket size and credit profile, but Close Brothers, Aldermore, Time Finance, Lombard and Novuna Business Finance are consistently among the most active and credible lenders in the market. Each has a different sweet spot, so the strongest choice for a £15,000 van is rarely the strongest choice for a £750,000 CNC machine.

This guide explains how asset finance fits within secured business lending, sets out a fair shortlist of providers with their strengths and watch-outs, and gives you the questions to ask before you commit. Greenwood Capital is a whole-of-market broker, so this is general, educational information rather than advice or a recommendation for your specific circumstances.

What is a secured business loan, and where does asset finance fit?

A secured business loan is borrowing that is backed by an asset the lender can recover if the loan is not repaid, which usually means a lower cost and larger facility than unsecured lending. The security can be property, plant, vehicles, receivables or the financed asset itself.

Asset finance is one branch of this wider family. The main types of secured business finance are:

Property-backed term loans are loans secured against commercial or, in some cases, residential property, repaid over a set term.
Commercial mortgages are longer-term loans to buy or refinance business premises.
Bridging finance is short-term secured lending used to cover a timing gap, for example between buying and selling a property.
Asset finance is funding to acquire or release cash from equipment, vehicles and machinery, where the asset itself is central to the security.

Within asset finance, the two most common structures are hire purchase, where you own the asset at the end of the agreement, and finance or operating leasing, where you rent the asset for a term. Asset refinance (sometimes called sale and leaseback) releases capital from equipment you already own.

How we chose these providers

We selected providers on market presence, breadth of asset classes, transparency of process and their track record with UK SMEs, not on commercial relationships. As an impartial broker we see a wide spread of lenders, and no single one wins for every business.

The shortlist below mixes large banks, specialist banks and independent funders on purpose, because the right answer often hinges on ticket size, asset type and how straightforward your accounts are. We have not invented rates or fees. Pricing in asset finance varies significantly by profile, asset and security, so you should always confirm current terms directly with the lender or ask us to gather comparable quotes.

The best asset finance providers in the UK

Close Brothers Asset Finance, best for established SMEs wanting a relationship-led specialist

Close Brothers is a long-established specialist lender with sector-focused teams covering areas such as construction, transport, engineering, agriculture and print. It suits established businesses that value dealing with people who understand their industry and the assets involved.

Hire purchase, leasing and refinance are all available, and the specialist knowledge can help when an asset is unusual or higher value. The watch-out is that a relationship-led model is not always the fastest for very small, simple deals, and terms are quoted case by case, so compare them against a broader panel before deciding.

Aldermore, best for straightforward hire purchase and leasing across common assets

Aldermore is a specialist bank that is well known for clear, accessible asset finance on mainstream assets such as commercial vehicles, plant, manufacturing and IT equipment. It suits SMEs that want a recognisable bank and a relatively streamlined process for standard equipment.

Hire purchase and finance lease options are its core, often introduced through brokers. Aldermore tends to focus on more conventional, saleable assets, so highly specialist or soft assets may be less of a fit. As always, confirm the balloon payment, term and any documentation fee up front.

Time Finance, best for smaller tickets and harder-to-place deals

Time Finance is an independent, multi-product provider that is often useful for smaller ticket sizes and deals that do not fit a mainstream bank’s template. It suits newer or smaller businesses, and cases where flexibility matters more than the lowest headline rate.

Its asset finance sits alongside invoice finance and other facilities, which can help a growing business that needs more than one line. Because independents price for risk and flexibility, the cost can be higher than a high-street bank for a clean, vanilla deal, so it is worth comparing directly.

Lombard, best for larger businesses and big-ticket assets

Lombard, part of NatWest Group, is one of the largest asset finance providers in the UK and is well suited to larger businesses and higher-value assets such as commercial fleets, agriculture, marine and major plant. It suits companies that want scale, structured facilities and the backing of a major banking group.

The breadth of expertise across big-ticket asset classes is a genuine strength. Smaller or non-standard businesses may find the process more suited to established borrowers, so weigh it against more nimble funders if your deal is modest or unusual.

Novuna Business Finance, best for vendor and broker-introduced vehicle and equipment finance

Novuna Business Finance (formerly Hitachi Capital) is an established funder that is active in vehicle and equipment finance, including through vendor and dealer programmes. It suits businesses acquiring vehicles or common equipment who value a smooth, technology-enabled process.

Its strength is efficient, high-volume lending on mainstream assets. As with any provider, check whether the structure is hire purchase or lease, and confirm end-of-term options so you know exactly what you own and owe at the finish.

Paragon Bank, best for SMEs seeking a specialist bank across several asset classes

Paragon Bank offers asset finance across a range of classes and is a credible option for SMEs that want a specialist bank alternative to the high street. It suits businesses financing plant, machinery, vehicles and certain professional or technology assets.

Hire purchase, lease and refinance are typically available. As with the other banks here, the fit depends on the specific asset and your accounts, so it belongs on a shortlist to compare rather than an automatic choice.

Asset finance providers compared

Provider	Best for	Typical products	Who it suits	Watch-outs
Close Brothers	Relationship-led specialist finance	HP, lease, refinance	Established SMEs, industry-specific assets	Case-by-case terms; compare before deciding
Aldermore	Straightforward mainstream assets	HP, finance lease	SMEs financing common equipment and vehicles	Less suited to soft or niche assets
Time Finance	Smaller tickets and harder-to-place deals	HP, lease, wider facilities	Newer or smaller businesses needing flexibility	May cost more on clean, vanilla deals
Lombard	Big-ticket and larger businesses	HP, lease, structured facilities	Larger firms, high-value fleets and plant	Process geared to established borrowers
Novuna Business Finance	Vehicle and vendor-introduced finance	HP, lease	Businesses buying vehicles and common equipment	Confirm structure and end-of-term options
Paragon Bank	Specialist bank across asset classes	HP, lease, refinance	SMEs wanting a high-street alternative	Fit depends on asset and accounts

Costs, terms and appetite change regularly, so treat this table as a starting point and confirm current figures with the provider or ask us to gather comparable quotes.

A worked scenario: weighing two providers

Imagine a growing engineering firm that needs a £40,000 CNC machine and has three years of solid accounts. On paper, both a specialist bank like Aldermore and an independent like Time Finance could fund it.

If the machine is a mainstream, saleable asset and the accounts are clean, a specialist bank may offer a keener rate on a standard hire purchase, which lowers the total cost over a four or five year term. If the same firm had only twelve months of trading, a prior blip on its file, or needed the deal turned around quickly, an independent funder that prices for flexibility might approve it where a bank would decline.

The decision therefore turns on the total cost of finance, the certainty and speed of approval, and whether ownership at the end (hire purchase) or lower monthly cost (lease) matters more. Comparing at least two structured quotes side by side is usually what reveals the genuinely better deal.

How to choose asset finance for your situation

The right provider is the one whose appetite matches your asset, ticket size and credit profile at the best overall cost, not simply the biggest name. Ask yourself these questions before you shortlist:

What am I financing? Hard assets such as vehicles and machinery are easier to fund than soft assets such as software or fit-outs.
Do I want to own it? Choose hire purchase to own the asset at the end, or a lease if lower monthly cost and flexibility matter more.
What ticket size? Smaller deals suit independents and specialist banks; big-ticket assets suit larger funders.
How strong are my accounts? A clean, established profile widens your options and usually lowers the rate.
How quickly do I need it? Speed of decision varies widely between providers.

What to check before you commit

Before signing any asset finance agreement, check the total cost and the exact terms, not just the monthly payment, because the structure can change what you pay and what you own. The key items are:

Total amount payable across the full term, so you can compare quotes on a like-for-like basis.
Whether it is hire purchase or a lease, and what you own at the end.
Any balloon or final payment, and how it affects the monthly figure.
Fees, including documentation, option-to-purchase and any arrangement fees.
Deposit or initial rental required up front.
Early settlement terms, in case you want to repay ahead of schedule.
Personal guarantees or additional security requested, and what they mean for you.
End-of-term options and condition requirements on leased assets.

Always confirm the current figures with the lender in writing before you proceed.

Let Greenwood Capital compare the market for you

Choosing between asset finance providers is far easier when you can see comparable quotes side by side. Greenwood Capital is a Manchester-based, whole-of-market broker, and we can review your asset, ticket size and profile, then approach a broad panel of lenders on your behalf.

This is general help to compare the market and match your situation, not financial advice. Tell us what you need to finance and we will gather the options so you can weigh them clearly and confirm the current terms with the lender before you commit.

Frequently asked questions

What is asset finance and how does it work?
Asset finance is funding that lets a business acquire equipment, vehicles or machinery, or release cash from assets it already owns, while spreading the cost over time. You typically pay a deposit and regular instalments, and the asset itself usually acts as security for the finance.
What is the difference between hire purchase and leasing?
Hire purchase spreads the cost of an asset and lets you own it once all payments, including any option-to-purchase fee, are made. Leasing rents the asset for a term, usually at a lower monthly cost, but you generally do not own it at the end unless a specific option is agreed.
Who are the biggest asset finance providers in the UK?
Lombard, Close Brothers and Aldermore are among the larger and most active asset finance providers, alongside specialist banks such as Paragon and independents such as Time Finance and Novuna Business Finance. The best fit depends on your asset and profile rather than size alone.
Is asset finance cheaper than a bank loan?
Asset finance can be cost-effective because the asset provides security, which may mean a lower rate than unsecured borrowing. Pricing varies by profile, asset and structure, so compare the total amount payable across the term and confirm current terms with the provider.
Can I get asset finance with bad credit or a new business?
It can be possible, because some independent funders and specialist lenders price for risk and consider newer or harder-to-place cases. Expect a higher cost, a larger deposit or a personal guarantee, and compare options before committing.
What assets can be financed?
Hard assets such as commercial vehicles, plant, machinery, agricultural equipment and manufacturing kit are the most commonly financed. Softer assets such as IT, software and fit-outs can sometimes be funded, though appetite and terms vary by lender.
What is asset refinance?
Asset refinance, sometimes called sale and leaseback, releases cash from equipment your business already owns by using it as security for a new agreement. It can free up working capital, though you take on repayments against an asset you previously owned outright.
Should I use a broker or go direct to a lender?
Going direct works if you already know which lender suits your asset and profile. A whole-of-market broker can compare multiple providers at once and match your situation, which can save time and surface options you might not find alone.