Regardless of what type of business you operate, it’s important to have the right funds available to hire staff, purchase materials and generally keep the lights on. There are countless different considerations and small optimisation that could help your business flourish, but additional funding (when used efficiently) is arguably the best way to do so.
As a recycling business, you have access to many government grants, incentives and tax credits that encourage you to try new things, innovate on your processes and expand your business. This is because a recycling business is considered a company that is helping society and generally improving people’s lifestyles. However, if you’ve run out of grant money and incentives to help fund your recycling business, then you may need to turn to other forms of funding such as asset finance.
What is Asset Finance?
Asset finance or asset-backed finance means that you’re using your business’s assets as collateral. This gives lenders more confidence in your ability to afford a loan or funding of some sort. As you may already know, getting a loan as a business isn’t easy and there are many different concerns, questions and considerations to keep in mind. Most banks won’t lend you money if you aren’t able to prove that you can make it back or even remain stable for long enough. Because of this, it’s important to consider business loans that are secured against something in order to have a better chance of getting more funding.
Asset-backed finance comes with its share of pros and cons. There are many fantastic advantages, such as being able to almost immediately approve a loan based on assets owned by your business. It also allows you to be more flexible with your spending, meaning you can invest it in a lot of different things to help your business run more smoothly and effectively. You can also improve your credit portfolio with asset-backed finance, helping you to secure larger loans in the future.
However, you may also want to consider some of the cons. For instance, you should be aware that if you’re unable to pay the loan back, you will need to forfeit your collateral. As a recycling business that relies heavily on expensive specialist equipment, this can be incredibly bad for your business if you default. Whatever funding option you choose, it’s a good idea to look at both the pros and cons to see if it can work for your situation. When in doubt, don’t hesitate to contact financial experts for more information.
Why Asset-Backed Finance for Recycling Businesses?
Recycling businesses tend to have a lot of expensive and heavy equipment that are used to recycle, sort and manage their materials. This means that recycling businesses have a lot of expensive equipment that can be used as collateral for an asset-backed loan. In other words, recycling companies have many choices for collateral.
This makes it very easy for a recycling business to obtain additional funding for new projects, innovative workflow changes or even hiring more staff. All of this is possible with the help of asset-backed finance.