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EQUIPMENT LOAN FOR START UP BUSINESS

EQUIPMENT LOAN FOR START UP BUSINESS

What is an equipment loan for a start-up business ?

An equipment loan for a start-up business is a type of financing that allows new entrepreneurs to purchase the tools, machinery, technology, or vehicles they need to operate, without having to pay the full cost upfront.

For a start-up business, an equipment loan is particularly valuable because it bridges the gap between initial investment needs and long-term revenue generation; Instead of depleting scarce funds, business owners can spread the cost of expensive equipment—such as computers, manufacturing machinery, medical devices, or delivery vehicles—over months or years.

What type of business loans are available for startups to purchase equipment ?

Here’s a list of the main types of business loans available for startups to purchase equipment (without naming specific lenders):

  1. Equipment Loans – Traditional secured loans where the equipment itself serves as collateral.
  2. Equipment Leasing – Instead of borrowing to buy, the business rents or leases the equipment for a fixed term, with an option to purchase at the end.
  3. Hire Purchase Agreements – A hybrid of loan and lease, where the startup pays installments to eventually own the equipment after the final payment.
  4. Asset-Based Financing – Loans secured against the value of business assets, including new equipment being purchased.
  5. Line of Credit – A flexible financing option where the startup can draw funds as needed to pay for equipment.
  6. Term Loans – Lump-sum loans with fixed repayment schedules, often used for larger, long-term equipment purchases.
  7. Invoice Financing (if already trading) – Allows a startup with early sales to advance cash against invoices to pay for equipment.
  8. Microloans – Small, short-term loans designed for startups and small businesses, often used to buy lower-cost equipment.
  9. Government-Backed Start-Up Loans – In some regions, start-ups can access subsidized loans specifically for equipment and working capital.

Which banks and lenders approve equipment loan for start up business in the USA, UK, Ireland, Canada and South-Africa ?

Here’s a curated list of banks and non-bank lenders that provide equipment loans or financing to startup businesses across the USA, UK, Ireland, Canada, and South Africa:

United States

  • Crest Capital – A nationwide specialist in equipment financing for startups and small businesses; offers quick same-day decisions and loans up to $250,000 with minimal documentation required. crestcapital.com
  • Beacon Funding – Offers “Start-Up Financing” for heavy-duty equipment like trucks, cranes, and specialty apparel gear, focusing on startups with limited operational history. beaconfunding.com
  • Kapitus – Provides equipment financing up to $500,000 for new or used assets, with approval in as little as 24 hours and terms up to 72 months. Kapitus
  • SBA Loans (504 and 7(a)) – Backed by the U.S. Small Business Administration, these loans can be used for equipment purchases; the 504 program offers long-term, fixed-rate loans up to $5 million, while 7(a) loans are versatile and widely used. Investopedia+1Small Business Administration
  • Customers Bank – A community-focused lender offering equipment financing to startups and small businesses across select U.S. regions. Customers Bank

United Kingdom

  • iwoca – A fast, flexible business lender offering unsecured loans (up to £1 million) with simple application and quick turnaround for equipment investment.
  • Funding Circle – A prominent SME lender offering business loans and the “FlexiPay” line of credit, suitable for equipment purchases and other capital needs.
  • Folk2Folk – Specializes in property-secured business loans across rural UK—suitable for equipment-heavy businesses in regional areas.

Ireland

  • FundEquip (via Finance Ireland) – A non-bank lender offering low-cost term loans specifically designed to help farmers purchase equipment such as generators, feeders, and milking systems.

Canada

  • Business Development Bank of Canada (BDC) – A Crown corporation providing tailored equipment loans for startups, including up to 125% financing of new or used equipment, with advisory support.
  • Canadian Equipment Finance and Leasing – Offers capital leasing, loan, and tailored financing solutions across industries for Canadian startups. CEF
  • CWB National Leasing – Canada’s largest equipment financing provider, offering loans and leases for a wide variety of equipment, including startups and medical use.
  • Equirex Leasing Corp. – Specializes in capital leases and equipment financing across Canada, including agriculture and industrial machinery via a broker network.

South Africa

While specific equipment-financing startup lenders in South Africa were not highlighted in the sources, the country’s financial landscape typically relies on:

  • Agricultural banks, development finance institutions, and local leasing companies that offer equipment funding—especially tailored to smallholder farmers and entrepreneurs.
  • Large institutions like the Industrial Development Corporation (IDC) and regional agri-finance schemes also play important roles, though specific names require further research.