Affordable SME Vehicle Financing from Stanbic Bank empowers businesses to access vehicles while maintaining financial flexibility.
Small and medium sized enterprises (SMEs) are the backbone of Kenya’s economy, and yet they run their businesses through so many hurdles. For may of them if not all, the right equipment for work and vehicles for mobility would improve their businesses tenfold. But the cost of owning these assets remains a significant challenge due to high one-off purchasing prices, insurance and operational costs.
However, SMEs do not have to bear this weight alone. With the right financial partner and tailored support on their side, vehicle and asset ownership becomes not only manageable, but also easier to navigate. Many financial institutions have these offerings, and this is where Stanbic Bank Kenya’s Vehicle and Asset Financing (VAF) comes in.
The Stanbic Vehicle and Asset Financing facility gives SMEs a chance to spread out the cost of asset acquisition over time, and entrepreneurs are therefore able to plan and budget for predicable payments. For many, this will work way better than waiting until they have saved enough money to purchase the assets, money which could be utilized as capital outlay to continually improve their businesses.
Financing from reliable financial institutions allows them to preserve their cash flow and use the funds in core areas of operation such as inventory and staffing. Rather than draining financial reserves on one-off purchases, SMEs can grow steadily and sustainably with manageable instalments from Stanbic Bank, spread over up to 72 months for new assets and up to 60 months for quality used vehicles.
A practical example would be if a school does not own and cannot afford a school van/bus or they use rickety ones, and yet their education services are top notch. Parents want to take their children to that school due to the education standards but are held back by the idea of using third party transporters every day for their children. With Stanbic Vehicle and Asset Financing, the school can get a new or used school bus, increase student uptake due to that, and therefore manage the payment instalments to the bank.
Same goes for farmers needing equipment which will exponentially increase their yield, increase cash flow and overall business growth and therefore manage loan repayments comfortably. This not only helps SMEs market themselves better, but also aligns them with better services and even more customer uptake and retention.
Another challenge that SMEs face is deciding how to structure their asset acquisition. Some would like to purchase for eventual full ownership while others would be comfortable leasing. For this, the Stanbic Bank VAF facility caters for both options. With hire purchase, the SME pays off the vehicle in flexible instalments and eventually owns the asset. Leasing on the other hand allows customers to use assets and other equipment without the obligation to own them. This reduces the pressure of tying capital that can otherwise be used for other investments. Source.
In one of the best moves to open up the Vehicle and Asset Finance offering, Stanbic Bank has simplified the entire application process and also offers guidance along the way. I call this one of the best moves because complex financial transactions are quite intimidating and can easily put some entrepreneurs and even individual vehicle buyers off.
For Stanbic, once an SME identifies the vehicle or asset they need, they simply provide a proforma invoice from a credible dealer along with proof of healthy finances, business registration documents and director identification PINs. The bank will review and approve the transaction if it meets all the thresholds and issue an offer letter. SMEs can enjoy a 60-day grace period before their first repayment is due, giving them time to put the vehicle to work and generate income before the instalments begin.
The bank also understands that many SMEs might struggle with sourcing reputable dealers or finding competitive insurance rates. That’s why Stanbic has built strong networks with verified auto dealers and insurance providers, easing the process of vehicle procurement and ensuring that SMEs receive quality products and services.
For instance, last year the bank signed an MOU with Mobikey Kenya to make vehicle financing more accessible and affordable, especially for trucks and trailers. Mobikey is a leading player in the zero-mileage vehicle distribution industry. Read more about the MOU here.
With these efforts and more, the high cost of owning vehicles to improve business is no longer necessarily a limiting factor for SMEs. They can now acquire the mobility tools they need to grow an compete without compromising the finances needed to run their businesses on a day-to-day basis. If you re a business owner and looking to take the next step into asset ownership, look no further than Stanbic Bank. Visit any branch and speak to a relationship manager or visit their website for details and to request a call back. With the right support, the road to business growth is wide open.
