As a taxi business owner, having a reliable and efficient automobile is crucial to your company's success.
However, purchasing new vehicles outright can be a significant financial burden, especially for smaller ventures.
That's where we come in!
As a reputable finance company, we'll take a closer look at its benefits for taxi businesses in the UK, how it compares to other lenders, taxi finance options, and finance solutions for taxis.
In the end, you'll better understand how it can help your taxi business succeed.
The taxi industry in the UK is a vital part of the country's transportation infrastructure, with thousands of licensed taxi drivers operating in cities, towns, and rural areas.
In recent years, the black cab industry has faced several challenges, including increased competition from ride-hailing companies like Uber and the need to transition to more fuel-efficient commercial vehicles to reduce emissions and operating costs.
Asset finance can play a key role in helping taxi businesses navigate these challenges by providing a flexible and cost-effective way to purchase new vehicles.
With our funding, corporations can spread the cost of the automobile over time, making it easier to manage their cash flow, pre-tax profits, and budget for other expenses.
Additionally, it can allow the business to upgrade to a newer, more fuel-efficient black cab, saving funds on fuel costs and reducing their environmental impact.
This is a way asset finance is available for companies in various industries, including transportation, to purchase automobiles such as private hire cars.
Private hire vehicles, also known as minicabs, are hired on a pre-booked basis, typically through a dispatch service.
Private hire vehicles are a popular transportation option in the UK and are used by industries and individuals.
Asset finance can be a useful option for businesses purchasing private hire vehicles.
It allows you to acquire the necessary automobiles to operate your business without paying the full cost upfront.
Your business can better manage its cash flow and income budget for other expenses by making monthly vehicle payments and gaining residual value.
We have various flexible taxi finance options for our customers; they include:
Hire Purchase (HP) financing allows you to purchase an automobile by making monthly repayments over a set period.
It is better than cash injection or dealing with conventional lenders.
You can purchase it as an asset outright at the end of the agreement.
Hire purchase can be a good option if you want the flexibility to own the machine eventually but need more time to be ready to pay the full upfront funds without looking like a bad credit.
This is a good option over secured loans, as it allows businesses to spread the cost of the auto over time and eventually own it outright.
Refinance or Capital Release uses the equity in your business's automobile to secure business loans to purchase a new vehicle.
This is recommended to upgrade your fleet without additional debt or a secured loan.
The benefit is that it allows you to use the equity you have built up in your existing fleet to fund the purchase of new ones.
Finance Lease is similar to business loans, but you retain ownership throughout the loan term.
You will make monthly repayments on the vehicle and can purchase it at the end of the term.
The pro is that it allows you to use the latest and most reliable automobiles without owning them.
An Operating Lease is similar to a finance lease, but your business does not have the option to purchase the vehicle at the end of the term.
This allows you to use the automobile for a specific purpose and avoid the responsibility of ownership or the hassle of lenders.
Its advantage is that it allows you to use a vehicle without needing to own it.
The interest rate on taxi asset finance can vary from 2%-20% depending on several factors.
The factors which effects the interest rate includes the type of finance product being used, the creditworthiness of the lenders, and the current market conditions.
However, you should note that this is just a general range, and the actual interest rate that a business is offered may be higher or lower depending on the specific circumstances.
You may also employ a taxi finance calculator for accurate calculations.
Our Taxi finance offers the following benefits and funding solutions:
Access to New Vehicles: Taxi finance allows enterprises to acquire new vehicles and other assets without paying the full amount upfront, which is useful for companies in the private hire industry.
More Flexibility: Our products, such as a hire purchase, taxi company operating lease, etc., allow corporations to spread the cost of acquiring assets over an agreed period, providing more flexibility in cash flow.
Good for Cash Flow: By spreading the cost of acquiring assets over time, taxi finance can help to improve a business's cash flow and reduce the burden of upfront costs.
A Better Understanding of your Business: By keeping track of the regular deposit made under a finance agreement, you can better understand your business's financial performance with taxi finance and make more informed decisions about your future growth and investment.
Tax Benefits: Firms may claim capital allowances on the assets they finance, which can provide a tax benefit and help reduce the overall cost of the finance agreement.
Taxi finance is regulated in the UK.
The Financial Conduct Authority (FCA) is the main regulatory body for the financial services industry in the UK.
It has specific rules and guidelines for companies that offer asset finance products such as hire purchase, finance lease, and taxi company operating lease.
In addition to the FCA, other bodies may also regulate taxi finance depending on the type of finance product used.
For example, hire purchase agreements may be regulated by the Consumer Credit Act 1974, while finance leases may be regulated by the Financial Services and Markets Act 2000.
Firms need to be aware of the regulatory requirements when seeking taxi finance, as this can help to ensure that the finance agreement is fair and transparent and that the business is protected from potential risks.
Our funding solutions offer competitive rates for taxi drivers and owners compared to other finance options, such as unsecured loans and leases.
It is excellent for those that want the flexibility to own a commercial vehicle and make payments towards ownership eventually.
Overall, our finance options can be an important tool for taxi agencies looking to grow and thrive in the face of industry changes and challenges.
By understanding the benefits of asset finance and the steps involved in obtaining it, firms can make informed decisions about financing the assets they need to succeed.