AfroRanking · Capital Advisory
Leasing and equipment finance in Africa
You hold the contract, your client is waiting, and what you lack is the ten trucks or the production line. We build your equipment finance in Africa and run 5 to 6 lessors against each other, so the machines land before the window closes.
Scope my equipment finance
Minimum ticket per capital layer, and the leasing mechanism in three moves.
01 · The problem
Your contract is signed, your bank says no
A haulier running ten trucks on a mining corridor knows the scene. The offtake is signed, volumes hold up, the banker listens, then the credit committee declines the equipment finance request. Four reasons recur.
- Track record falls short. Your company has two financial years, the committee wants three or five.
- Security looks thin. A goodwill pledge and a plot still going through title registration will not cover several hundred thousand euros of exposure.
- Loan currency does not match revenue currency. You invoice in local money, the bank lends hard currency, and the FX risk stays with you.
- Tenor does not match the asset. Eighteen months gives you no room to amortise a prime mover that will run for seven years.
Meanwhile your client waits and a competitor moves in. Equipment finance changes how the lender reasons: the asset funds the asset. The lessor buys the truck, keeps legal title, its risk drops, and your two financial years stop blocking the file.
This is also the lowest door in the stack. The ticket starts near €10k in equipment finance, against €50k for a local bank, €200k for quasi-equity and €3m for development finance debt. We open that door first.
02 · The offer · what we activate
Six forms of equipment finance we activate for you
Depending on your equipment, your country and your client contract, we go after the form that clears. Picking the mechanism stays our job.
Finance lease
The lessor buys the equipment you selected, you pay a rental, you buy it out at the end. The form we activate most often on a fleet.
Lease with purchase option
Shorter commitment, higher rental. We use it to keep you off a seven-year lock-in on a route you have yet to prove.
Vendor finance or captive lender
We route the file through the manufacturer or its finance arm. Timelines shorten, and the service network comes with the offer.
Export credit insurance
We back your file with the public insurer of the supplier country, which stretches the tenor on new imported equipment.
Local bank leasing desk
We open the leasing desks of banks in the region. Local file, local currency, currency mismatch removed.
Prepayment or contract advance
We negotiate the advance from your offtaker that covers fuel, tyres, wages and insurance in the first months.
02 · The offer · what we secure
The three blockers we clear before your file goes out
A lessor almost always declines for one of these three reasons. We handle them before the first meeting, not after a refusal.
LEVEL 01
The asset
What we prove to the lessor
- We document year, hours and actual condition
- We check the approved workshop and parts in country
- We pull the regional resale value
- We rule out brands nobody buys back
LEVEL 02
The cash flow
What we demonstrate
- We price the margin per unit and per rotation
- We tie the monthly payment to your client contract
- We build the low season into the utilisation rate
- We correct for your clients’ real payment terms
LEVEL 03
The file
What we put together
- Down payment, guarantee and pledge calibrated
- All-risk and business interruption cover
- Onboard telematics and fleet tracking
- Maintenance contract and parts plan
We run the rest of your structure too
Bankability, capital structure, data room, negotiation: see the capital advisory page.
02 · The offer · what we run
The equipment finance path we run for you
You stay on your operation. We hold the file from the supplier quote to commissioning.
Allow 4 to 6 weeks to build the core file, then 3 to 4 months to signed offers. Equipment finance closes faster than an equity round.
03 · The benefit
Your equipment delivered, your contract earning revenue
Equipment finance in Africa carries 20 to 30 % of a typical capital stack, alongside a local bank, your own equity and a partial guarantee. What you get out of it comes down to two things.
You start earlier. A conventional bank loan stalls on track record and security for months. Equipment finance leans on the machine, and your first invoiced rotation lands well before that.
You pay less. We approach 5 to 6 lessors in parallel to secure 2 to 3 comparable offers, then put them head to head on down payment, tenor, residual value and security. A lessor approached alone applies its rate card. Three lessors in competition agree to revisit it.
If your need falls below the development finance floor, around €3m, we build the combination that holds: equipment finance on the assets, a local bank line on working capital, a partial guarantee and an offtake contract. We also check your country status at the relevant export credit agency before building on top, because a closed position brings the structure down.
The path
The steps that come before equipment finance
Bankability audit
What a credit committee reads in your accounts, your contracts and your governance.
Project funding sources
The map of capital layers, from DFIs to local banks, with the minimum ticket of each.
Investor data room
The documents due diligence asks for, and the order to file them in.
Capital advisory
The full mandate: structuring, investor package, funder pipeline, closing support.
Fundraising
The whole path, from the first numbers to a signed term sheet.
Frequent questions
Equipment finance in Africa: six questions
What down payment does equipment finance in Africa require?
Lessors ask for a down payment in the low double digits of the asset price, sometimes topped up by a cash deposit. The level is negotiated file by file: a liquid asset and a solid client contract push it down, specialised machinery pushes it up. We price that contribution before approaching the first lessor.
Can used equipment be financed?
Yes, on tighter terms. The lessor examines the year, the hours, the service history and the regional resale value. Expect a shorter tenor, a larger down payment and a technical inspection before approval.
How long does a leasing file take?
The core file takes 4 to 6 weeks: unit model, supplier quote, legal and accounting documents. Approaching lessors and negotiating then runs 3 to 4 months. Delivery adds its own lead time, which depends on the manufacturer and the port of entry.
Is equipment finance more expensive than a bank loan?
The headline rate often runs above a conventional loan, and the gap narrows once you count the time saved and the tax treatment of rentals. No rate can be quoted in advance: it depends on the country, the currency, the asset type and your profile. We compare equipment finance offers on all-in cost, never on the headline rate.
Do you need a signed contract with an end client?
Few lessors demand one formally, and a firm contract changes how the file lands: it shows where the monthly payment comes from. Failing that, bring historical invoices, purchase orders and a documented utilisation rate.
What happens at the end of the term?
Three outcomes depending on the form signed: you exercise the purchase option at the agreed residual value and own the asset, you hand the equipment back, or you extend the lease. Fix that residual value in the original equipment finance contract.
Let us price your equipment finance in Africa
Send us the supplier quote, your client contract and your last two financial years. We will tell you which form of equipment finance fits, which layers to target and what the file still lacks.
Start my equipment financeInstitutional resources: World Bank, Africa · UNCTAD investment · African Guarantee Fund · IFC in Africa. Related pages: capital advisory, fundraising, bankability audit, funding sources, data room. Home · Contact. AfroRanking structures and advises, without collecting funds or guaranteeing an outcome.