Find out more about it and your benefits
Leasing is based on the idea that the use of a capital asset is more important than its ownership. This instrument is appreciated by companies that need financing for their growth, but at the same time want to preserve their liquidity. After all, acquiring a capital asset can be very capital intensive and severely limit working capital.
Did you know that there are different Leasing options? Let’s deep dive in those:
–Leasing is a leasing method that has no or a very short contract term. In addition to this, the cancellation options are very flexible. At the end of the contract, the leased asset is returned to the lessor. No further obligations arise for the lessee.
Financial Leasing are generally medium-term leases that are hard to cancel. The leased object that may be a movable or immovable property is amortized down to a small residual value. The contract can include services and its aim is to guarantee a full debt financing.
Sales & lease back is used when a company sells its own tangible fixed assets to a leasing company and subsequently leases the items from it. As this is a special form of financing and for legal reasons, this type of contract is limited to real estate in Switzerland.
A Vendor Leaser is a larger company that itself provides various machineries to smaller SMEs in the form of a rental (lease) so that they can use this equipment and grow their business.
Real estate leasing focuses on buildings used for production and storage, as well as department stores, hotel complexes and public buildings. The usual contractual floor is CHF 1 million.
What about the evolution in Switzerland ?
For companies with insufficient equity capital, leasing is the most popular financial tool and 36% of the firms finance themselves through leasing. The leasing volume remains stable in Switzerland, with a small decrease in 2019 from CHF 24.03 billion to CHF 22.4 billion in 2020. A good number of new businesses are financed by leasing, most of them are service companies and industries that lease cars, ships, aircrafts, and trains.
Why is leasing beneficial for your company?
With leasing, companies have the following advantages:
• Fixed monthly payments
• No increase in fixed assets, only depreciation in the income statement (tax advantages and improvement of debt capacity)
• Lease back is especially recommended for customers who do not have a high net profit
• The possibility of investing the excess liquidity in other strategic projects
• Retention of title. In the case of a retention of title (Art. 715 of the Civil Code), the seller of a movable good remains the owner until the purchase price has been paid in full by the debtor. This is relevant because in the event of bankruptcy of the buyer, the good continues to belong to the seller.
PrestaFlex, your trusted leasing partner
Like for any other financing solution, a trusted partner is essential for leasing too. PrestaFlex experts have the needed expertise to ensure the best possible financing. We have been working in this industry for over 20 years and successfully cooperate with more than 40 partners to provide a customized advice.
Depending on the industry, financial situation and needs, the conditions are as follow:
• Leasing amount from CHF 50 000 to 2 000 000, higher amounts are considered individually
• Leasing duration between 12 to 120 months possible
• Residual value negotiable between 1 and 20%
• Interest rate between 0.85% to 6%
Interested? You only need to send these required documents for a pre-evaluation:
• Solvency, balance sheet and income statement of the last 2 years
• ID copy from the managing director
• Investment goods
The best part is that the fast processing of the request takes only between 3 to 5 working days.
Authors: Javuz Selim Tasoglu, financing consultant at PrestaFlex, Sinan Özsoy, financing consultant at PrestaFlex, Fribourg