comparison
What is the difference between asset finance and a business loan?
Short answer
Asset finance is secured against the specific asset being purchased (via a chattel mortgage, finance lease or operating lease), while a general business loan may be unsecured or secured against other business assets. Asset finance on AssetMX covers $5,000 to $500,000 over 12 to 84 months, with the asset itself as security.
Last reviewed 8 September 2026 by AssetMX.
Direct answer
Asset finance and a general business loan both provide funds for your business, but they work differently. Asset finance is tied to a specific asset, such as a vehicle, truck or piece of equipment, and the asset itself is typically the lender’s security. A general business loan may be unsecured or secured against other assets or a director’s guarantee, and can usually be spent more flexibly. On AssetMX, asset finance covers $5,000 to $500,000 over terms of 12 to 84 months.
How the structures differ
| Feature | Asset finance | General business loan |
|---|---|---|
| Security | Usually the asset itself | Varies: unsecured, or secured against other assets |
| Use of funds | Tied to a specific asset purchase | Often more flexible |
| Common structures | Chattel mortgage, finance lease, operating lease | Term loan, line of credit |
| Ownership during term | Business owns asset (chattel mortgage) or lender owns it (lease) | Not applicable |
Why the security matters
Because asset finance is secured against a tangible, identifiable asset that holds resale value, it is a distinct product from a general business loan. Under a chattel mortgage, your business owns the asset from settlement while the lender holds a registered security interest over it. Under a finance lease or operating lease, the financier owns the asset and your business pays to use it, with a residual or balloon payable at the end of the term. See chattel mortgage vs finance lease for the detail on each.
When to choose asset finance
Asset finance suits a specific, one-off purchase, such as a ute, truck or piece of equipment for the business. A general business loan may suit working capital needs, stock purchases, or costs not tied to a single asset. The two are not mutually exclusive: many businesses use asset finance for vehicles and equipment and a separate facility for working capital.
Where to next
See indicative rates for the term you need on the rates page, or compare structures on how we compare.
This is general information only and does not take your circumstances into account. It is not financial, tax or legal advice.
Related questions
Can I use asset finance for anything other than vehicles and equipment?
Asset finance is structured around a specific, identifiable business asset, typically a vehicle, truck, trailer or piece of equipment. It is not a general-purpose cash facility.
Is asset finance cheaper than a business loan?
It depends on the lender, term and your circumstances. Because the asset itself secures the debt, asset finance can sometimes attract a lower rate than an unsecured facility, but this varies and should be compared on a case-by-case basis.
Do I own the asset with asset finance?
It depends on the structure. Under a chattel mortgage your business owns the asset from settlement. Under a finance lease or operating lease, the lender or financier owns it and your business pays to use it.
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Trading 2+ years · Clean credit · Vehicles, trucks or equipment for business use