IT and technology finance for New Zealand businesses.

Because the security is genuinely weaker. Recovering distributed end-user devices is impractical, and a recovered three-year-old fleet realises a small fraction of its cost. Lenders in this class are substantially assessing the business rather than the hardware, so indicative pricing sits closer to unsecured business lending than to the asset finance bands elsewhere.

The same length as the refresh cycle. A four-year facility on a three-year fleet means paying for machines already replaced while also paying for their replacements, and doing that twice leaves a business permanently carrying two facilities where it intended to carry one. A longer term shows a lower weekly figure and is not a saving.

For equipment that will be replaced rather than kept, an operating lease does something a hire purchase cannot, because the hardware goes back at the end and the refresh and the facility end on the same day by construction. For a server the business intends to run for five years, a hire purchase ending in ownership makes more sense.

Perpetual licences bought outright can usually be financed alongside the hardware, because something is actually being purchased. Subscription software billed per user per month cannot, because nothing is bought. On many New Zealand projects the subscription component now exceeds the hardware, so a facility covers a minority of the spend.

No. Cloud infrastructure is an operating cost rather than a capital purchase, so there is no asset to secure and nothing to finance. Where a cloud service replaces a server, the question stops being how to fund a purchase and becomes whether an ongoing operating cost is acceptable, which is a different decision entirely.

Rarely, and it is usually not worth pursuing. Values are low and fall quickly, so the facility costs more to arrange than the security is worth. Refurbished hardware is more commonly bought outright, which avoids both the arrangement cost and the term-matching problem.

Under a hire purchase, a GST-registered business is generally able to claim the GST on the full purchase price in the return covering the period the agreement begins rather than across the payments, subject to the accountant’s confirmation of the accounting basis used. Under an operating lease the GST is typically claimed on each rental as it is invoiced, again subject to the accountant’s confirmation.

Secure erasure is the business’s obligation rather than the lessor’s, and the return date is fixed whether or not it has been done. Planning it into the changeover rather than discovering it on the return date is the practical answer, and the lease terms are worth reading for what condition equipment must be returned in.

Some lenders will include configuration, data migration and professional services in a facility and others will not. Where they can be included, it keeps the project on one agreement. Where they cannot, they land on operating cash flow at the same time as the hardware arrives, which is worth knowing in advance.

No. A click charge is a service arrangement billing per page with its own term and commonly a minimum monthly volume, and it is a separate commitment from any equipment finance. It is frequently signed at the same time as hardware is supplied, and the two together are the real cost.

It can be, and lenders treat it more like fit-out work than like equipment because it is installed into the premises and cannot be recovered. That means it commonly attracts a deposit, and where the premises are leased the lease term matters for the same reasons it does in hospitality.

Frequently not. On small amounts, the arrangement fee and the higher rate in this class together can outweigh the cash-flow benefit of spreading the cost. Where the purchase is small enough to absorb without straining working capital, paying for it outright is commonly the cheaper and simpler answer.