Lease/Sale & Lease Back
|Lease Financing||Sale & Lease Back|
|Purpose||Asset backed financing against industrial machinery, commercial equipments, office equipments, generators, vehicles, vessels, engines, etc.||Financing against any of the existing (already procured/in-use) industrial machinery, commercial equipments, office equipments, generators, vehicles, vessels, engines, etc.|
|Amount of financing||Up to 100% of the acquisition cost.||Up to 100% of the written down value (cost net of depreciation) depending on the condition of the machine.|
|Tenure||3 to 5 years.||3 to 5 years depending on original date of purchase and current condition of the asset.|
|Mode of repayment||Through monthly or quarterly rentals.|
|Size of rental||Rentals may be equal or structured (step-up, step-down, bullet, etc.)|
|Legal ownership||Legal ownership remains in the name of FFIL throughout lease period.||Ownership of the asset is transferred to FFIL at the time of financing and remains in the name of FFIL throughout lease period.|
|Ownership is transferred to the client at the end of term.||Ownership is re-transferred to the client at the end of term.|
Collateral to secure the finance is not mandatory in FFIL. Rather the type and mode of security depends on
(i) the nature, experience and performance of the business
(ii) past track record of the sponsor(s) and
(iii) the amount of financial facility to be enjoyed.
Types of security may be either of as follows (but not limited to):
- Personal Guarantee of the Sponsor Directors.
- Collateral securities like: land, building etc.
- Post Dated Cheques.
- Charge documents as per formal of FFIL.