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Commercial Lending Partners

All You Need To Know About Asset Finance In NZ

At Commercial Lending Partners, we provide a range of financial solutions to help New Zealand businesses. One of the most common lending types is asset finance, which allows businesses to acquire necessary equipment or assets through financing rather than paying for them upfront. In this blog, we will provide an in-depth look at asset finance, including important information on the different types of financing options, the benefits and drawbacks, and how to choose the best option for your business. 

What is Asset Finance?  

Asset finance is a method of acquiring assets, such as equipment, vehicles, machinery or trucks, through financing rather than paying for them outright. It allows businesses and individuals to acquire the assets they need to grow and operate without having to use their own capital.  

What is an Asset?

An asset is an item of value that a company or individual owns. Assets can be tangible, such as property, equipment, and inventory, or intangible, such as patents, trademarks, and copyrights. Assets provide future economic benefits, such as cash flow or appreciation in value, and they are used to produce revenue or to provide services. Assets can be classified as current assets, long-term assets or fixed assets.  

Current Assets: Current assets are assets that are expected to be converted into cash or consumed within one year.  

Long Term Assets: Long-term assets are assets that are expected to be used for more than one year. 

Fixed Assets: Fixed assets are assets that are used in business operations and are not intended for resale. 

What are the different types of Asset Finance?  

  1. Term Loan : The finance company lends the money to your business to purchase the assets upfront. A security charge is registered over the asset and your business will make payments (including interest) to the lender until the loan is paid off at which time the security will be released. 
  2. Operating/Equipment Lease: An operating or equipment lease is a control agreement where the asset is lent to the business for a period of time. Payments are made until the contractual period ends and the equipment is returned. 
  3. Finance Lease:  A finance solution where the rights and obligations of ownership of the leased item are taken over by the business/borrower at the end of the lease.  
  4. Asset Refinancing: Asset refinancing is where a business gets its loans secured for assets by pledging its current assets. The business’s current assets are assessed in value and used to create a loan based on the value of the asset.  

What are the pros & cons of using Asset Finance?  


  • Access to funds: Asset finance allows businesses to acquire assets that they need to grow and operate their operations even if they do not have the capital on hand. 
  • Preservation of cash: Asset finance allows a business to preserve its cash for other purposes. 



  • Ongoing costs: Asset finance typically involves ongoing costs, such as interest payments and maintenance fees, which can make the overall cost of the asset higher than if it had been purchased outright. 
  • Credit risk: Asset finance is typically secured against the asset being financed, which means that if the business defaults on the loan, it may lose the asset. 


As Business Lending Experts, we can help you source the capital required to drive growth in your business. Get in touch with us today to find out how we can help you. 

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