Machinery and equipment finance
Machinery and equipment loans pay for a specific machine, plant or equipment — a lathe, a printing press, medical equipment, a generator — with the asset itself as the main security. The lender pays the supplier directly, and the loan runs over the useful life of the machine. Lenders look at the machine, the supplier and the business’s ability to earn from it.
We explain what lenders usually ask for and help you get your papers in order — the first call is free.
Estimate your EMI
EMI calculator (estimate only)
Enter the amount, the yearly interest rate and the number of months. The estimate uses the reducing-balance method that most banks use for term loans.
Estimate only. Your lender sets the actual rate, EMI and charges.
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Details
What lenders usually check
- The machine: make, model, new or used, supplier’s standing, and whether it has a resale market.
- The business: trading history, financials, GST and bank statements.
- How the machine will add to income — orders in hand, capacity, contracts.
- Your own contribution and the site where the machine will be installed.
- Existing loans and credit records.
Documents to keep ready
- Business registration, GST, MSME registration, PAN; owner’s identity and address proof.
- Proforma invoice or quotation from the supplier, with specifications.
- ITR and financial statements for two or three years; GST returns; bank statements.
- Proof of your own contribution.
- For used machines: valuation report and ownership papers.
- Site proof — ownership or lease of the premises.
Repayment
Monthly EMIs, typically over three to seven years, matched to the machine’s life. A short moratorium until installation is sometimes allowed.
Interest and charges
Usually fixed. Processing fee, documentation charges, insurance on the machine, and prepayment charges. Ask whether the rate is on a reducing balance.
Security or own contribution
The machine is hypothecated. Lenders fund a share of the invoice value; you pay the rest, plus transport and installation, yourself. Larger loans may need additional collateral or a guarantee-scheme cover.
How to prepare
Get a detailed quotation with delivery and installation terms. Prepare a simple sheet showing extra revenue or savings from the machine and how the EMI will be met. Keep the supplier’s credentials handy. Arrange your own contribution before applying.
Questions about machinery finance
How much of the machine’s cost will be funded?
A share of the invoice value; the rest is your contribution. Used or specialised machines get a smaller share.
Is the money paid to me or to the supplier?
Usually directly to the supplier against the invoice.
Can I finance imported machinery?
Yes, with import documents; some lenders offer foreign-currency terms. Ask about exchange-rate risk.
Can I finance a used machine?
Many lenders do, with a valuation and an age limit at the end of the loan.
What if the machine breaks down?
The loan continues. Insurance and a maintenance contract protect you; the lender usually requires insurance.
Is there a government scheme?
Some sectors have credit-linked capital-subsidy or technology-upgrade schemes. Ask your bank and the relevant ministry portal.
Does the lender own the machine?
You own it; the lender holds a charge on it until the loan is repaid.
What we do here: we explain what lenders usually ask for and help you get your documents in order. We do not lend, arrange loans or take commission. The first call is free. See what we do.
