Financial leasing VS operating leasing VS bank credit: Which one is better?

In the process of enterprise development, the choice of financing method is crucial. As a flexible financing method, financial leasing is gradually being favored by more and more enterprises. So, what is the difference between financial leasing, operating leasing and bank credit?

Financial Lease VS Operating Lease

• Different ownership: In operating leases, the ownership of assets still belongs to the lessor; while in financial leases, after the lease expires, the lessee can opt to purchase the assets， gaining ownership.

• Difference in term: The term of financial leases is generally longer, close to the useful life of the assets; the term of operating leases is relatively short.

• Financial impact: Financial leases can include assets in the lessee's balance sheet and improve the company's asset structure; operating leases are usually not reflected in the balance sheet and have little impact on the company's financial indicators.

Financial leasing VS bank credit

• Guarantee requirements: Bank loans usually have higher guarantee requirements for enterprises; financial leasing pays more attention to the value and cash flow of the leased assets, and the guarantee requirements are relatively flexible.

• Approval process: The approval process for financial leasing is relatively fast and can meet the capital needs of enterprises more timely; bank credit approval is more strict and complicated.

• Use of Funds: Financial leasing is mainly used for the purchase of specific assets; bank credit funds are relatively widely used.

SUMEC Financial Services: Leading Financing Solutions in Asia Pacific!

One-stop financial services to solve financing problems! Shanghai SUMEC Business Consulting Co., Ltd. as a leading fixed asset investment consulting agency in the Asia-Pacific region, relies on the strong background of SINOMACH and the strong strength of SUMEC to tailor one-stop and diversified financial service solutions for enterprises.

• RMB financing series: Whether it is short-term quick financing or customized equipment financing, Sumec can respond quickly to help enterprises seize market opportunities.

• Foreign currency financing series: In response to the high-end fixed asset investment and green transformation needs of enterprises, we provide all-round support such as foreign currency installments, loans, project financing, etc. to help enterprises "go global".

Global resources, local wisdom: Working closely with more than 3,000 equipment manufacturers and more than 100 financial institutions around the world, SUMEC Financial Services, with its professional market insights and rich international experience, builds a bridge for enterprises to connect global capital and local markets.

Choosing Sumec Finance means choosing a strong financing partner and a wise consultant who can grow with your company! In this era full of challenges and opportunities, let us join hands with Sumec to create brilliance together!