Flexible, relevant and cost-effective asset finance solutions for business
This brochure will give you a good idea of what Business Banking has to offer. We specialise in putting together flexible, relevant and cost-effective finance packages for whatever assets you require. Our comprehensive solutions take into account the present position of your company as well as its future goals. Key decisions when financing assets
There are several ways in which Business Banking can finance assets for your business. Your choice will depend on the type of asset you wish to finance, your objectives and the conditions that will best suit the unique financial structure of your company. You may have more options than you think – each likely to have a different impact on your business.
The cost of financing assets
We are well aware of the difference that the right finance contract can make to your bottomline. The wide variety of options available allows you and Business Banking to agree on a contract that precisely suits the way you manage your business, while a high degree of flexibility helps you to streamline your financial management, optimise your cash flow and save money. Bear in mind that the way you finance your assets will also have tax implications for your company. We can offer innovative, flexible, relevant and cost-effective finance for all types of company assets.
Ownership or usage
To choose a financing option you must first decide whether you require ownership of the asset or only the use of it. This decision will ultimately determine which of the following financial options you select: instalment sale, financial lease, financial rental, full-maintenance lease, operating rental, or medium-term loan.
Financing motor vehicles and managing your fleet
Selecting the right vehicles and arranging appropriate finance can be time-consuming and confusing, while managing your fleet can generate a heavy administrative load. We can provide a total solution that takes into account the requirements of your company and available financing options.
Why choose Nedbank to finance your vehicles?
Convenience: Your finance can be preapproved. You can then arrange the details by phone, via the internet or through your business manager. A range of finance options: The type of finance you choose will depend on whether you wish to own the vehicle or simply use it. Our solutions include finance focused on asset usage rather than ownership, allowing you to control your cash flow. To avoid unforeseen costs you may opt for full-maintenance leasing, where we take responsibility for and carry the risk of maintenance costs. Or you may prefer an operating rental, where you are responsible for the cost of maintenance. Vehicle sourcing and delivery: Through our Car-buying Unit we can negotiate an optimum discounted price on a new vehicle, arrange a test drive, register and license the vehicle and deliver it to your doorstep. There is no cost to you for the service component. To find out how we can help you to acquire your next vehicle contact us on 0860 119 500.
Every year Nedbank buys thousands of new cars on clients’ behalf, centralising this considerable buying power in its Car-buying Unit located in Johannesburg. In order to source these vehicles, we have online access to some of the biggest dealer groups in the country. The Car-buying Unit will: • • source the vehicle of your choice from a list of at least 500 dealers countrywide – saving you time; negotiate the going corporate discount rate for you, irrespective of how many vehicles you have in your fleet. This saves you time and gives you the same advantage as major corporates when it comes to price, even if you have only a small fleet; • arrange a test drive at your premises, then license the vehicle and deliver it to you.
You are welcome to use the Car-buying Unit even if you do not finance the vehicle through Nedbank. This service is free of charge, so before you buy your next vehicle, call 0860 119 500.
A comprehensive, custom-made solution for fleet owners
NedFleet will source vehicles, provide fleet maintenance and management facilities and do everything possible to get the best trade-in prices for your existing vehicles. This cost- and tax-effective system helps you to monitor and control your fleet expenditure, as it provides comparative reporting (very valuable when fuel prices are high) and a suite of cards for company vehicles. Each of these is designed for a specific purpose: a toll-only card for transport vehicles; a ‘full-house’ card for fuel, maintenance and toll fees; a maintenance-only card; and a vehicle card for individuals.
Financing capital equipment
We provide a cost-effective solution for financing movable assets. Whether you opt for ownership or usage only, we can arrange an appropriate, tax-effective deal.
Why choose Business Banking to finance your capital equipment?
Convenience: Your finance can be preapproved by means of the granting of prearranged limits to your business, which will be reviewed annually together with your other banking facilities. This will help you to make an objective buying decision without pressure, and there will be no delays in credit turnaround, as everything is arranged at the outset. Several finance options: The type of finance you choose will depend on whether you require ownership or usage only. • • • • Instalment sale: this may be a suitable option if your business requires ownership of the asset, not just usage. Financial lease: this is an appropriate option if usage of the asset is your priority. Financial rental: this operates in the same way as a financial lease, except that VAT is calculated on and payable with each rental. Medium-term loan: this is a loan agreement secured by various types of assets. Specialist advice: Your business manager may call in an asset finance specialist to help you to structure your finance, and advise on timing your acquisition to your best advantage. They will also help you plan your cash flow on the basis of the productivity and lifespan of the equipment. Flexible repayment schedule: Where possible, we shall consider starting repayments on a contract only when the cash flow generated by the equipment permits – while the level of repayments will depend on the productivity of the asset and the way the deal is structured. We also take the cyclical nature of your business’s cash flow into account when structuring your repayment schedule.
Importing capital equipment
We can arrange, control and manage the import of capital equipment to be financed by Business Banking. This is particularly useful for occasional importers unfamiliar with import procedures. We offer a door-to-door import service, which includes practical assistance with exchange control and import permit applications, forward exchange contracts, transfers, letters of credit and documentation. Our team will monitor the progress of the equipment being imported, and can arrange for inspection of the goods before shipping. In fact, we can customise a package to match your company’s requirements, helping you to manage risk and handle the complex and time-consuming paperwork and procedures associated with importing equipment.
Secured term finance
This finance option is designed to unlock capital currently tied up in income-generating equipment owned by your company. The facility gives you access to extra capital that you may need to fund the growth of your business. It also allows you to take advantage of opportunities that may arise in your business environment. The degree to which secured term finance will benefit your company will depend on your specific business requirements. Before you opt for this facility, compare the rate of return that your business would earn from using the funds released with the cost of secured term finance. Our asset finance specialists are always available to help you to make the right decision.
NedBond is available for financing/refinancing commercial/industrial property such as factories, distribution facilities, warehouses and office premises that are primarily used by you, the owner, in the normal course of your business. NedBond allows you to unlock capital tied up in fixed commercial property – capital that could be employed more profitably elsewhere in your business. We have added some useful additional features to the basic NedBond finance package: • finance periods of up to 15 years: • interest-only repayment structures: this means lower repayments than with the usual five-year finance arrangements; special approval of this structure is always required. If approved, you pay only the interest, while the commercial value of your property moves according to market conditions over the life of the agreement. You will, however, be required to settle the outstanding balance at the end of the contract period or when the agreement is terminated prior to its expiry date; and • prime-linked and fixedinterest-rate structures: depending on your risk profile you will be able to determine which rate structure or combination of structures best suits you, your business and the environment in which you operate.
If your primary business is that of importing and supplying valuable equipment to the South African industrial/manufacturing market, this product may be for you. Indeed, you may already have experienced difficulty in raising the credit you need to import an expensive piece of equipment for a customer. Essentially, there are two ways of using supplier finance facilities: • • arrange a finance facility against a firm order from your customer; this will allow you to import the equipment and pay foreign (and local) suppliers without affecting your existing credit lines; or arrange finance to import stock of capital equipment for your showroom (without already having firm orders) using the strength of your own balance sheet.
You may wish to sell equipment to customers who do not have the cash or capital expenditure budget to pay for it immediately. They may ask whether you can provide the necessary finance. Now you can offer them medium-term asset finance without taking on the associated credit and operational risk. At Business Banking we have a dedicated Vendor Finance Unit that will establish a close working relationship with you and your sales force. Through this relationship, and the operational capacity of the Vendor Finance Unit, you will be able to offer your customers medium-term asset finance without having to involve yourself or your business in what is effectively a general banking operation. You and the Vendor Finance Unit share the same objective: to give your business a free, outsourced, assetfinance arm that allows you to offer medium-term finance to your customers. This will increase your chances of making a sale that might otherwise go to a competitor able to provide the necessary finance.
Premium finance offers businesses easy access to cost-effective financing for annual short-term insurance policies. Your annual premiums (which possibly qualify for a discount from underwriters) are settled upfront by the bank, while you repay monthly in advance over 10 months. You are covered for the full year without any threat of premium increases during that time. You do not have to provide any additional security (security is contained in the policy), interest rates are competitive (you may choose either the fixed or linked option) and you can reclaim VAT immediately – all of which would improve your cash flow. All short-term insurance requirements are catered for in one transaction in consultation with your insurance broker.
A full range of insurance and assurance products is available through Nedbank to reduce and manage the wide range of risks that faces you and your business in today’s volatile environment.
Fixed-rate interest structures
An asset finance agreement generally continues over a number of years. Unfortunately, unforeseen events – such as the Asian Crisis of 1998 – occur from time to time, and it is impossible to forecast with any certainty how interest rates will behave in future. However, you can reduce uncertainty about interest rate movements: consider a fixed-rate finance arrangement for all or some of your new asset finance deals at Business Banking. Fixed-rate finance is available for virtually any asset finance contract period, provided the sum involved exceeds R1m. You can also stay flexible by choosing a fixed-rate product that allows you to switch into a prime-linked structure when you believe interest rates are on a downward trend. To arrange finance for your next asset purchase, speak to your business manager or contact us by email on email@example.com
Email: firstname.lastname@example.org Web: www.nedbank.co.za
Nedbank Ltd Reg No 1951/000009/06. We subscribe to the Code of Banking Practice of The Banking Association South Africa and, for unresolved disputes, support resolution through the Ombudsman for Banking Services. We are an authorised financial services provider.