MOTORHUB MAGAZINE
A cheap way to buy
expensive cars…Finally!
Vehicle and asset financing is a global trend when it comes to purchasing vehicles and other assets. Motorhub’s Edmond Atto caught up
with Apollo Twinomuhangi, the head of vehicle and asset finance at
Stanbic Bank Uganda.
To the average Joe, could you
describe Vehicle and Asset
Financing?
VAF (Vehicle and Asset Finance) is an
alternative means of financing the acquisition of identifiable, movable, durable
and insurable assets. These may include
Motor Vehicles, Machinery, Plant and
equipment.
How does leasing in Stanbic
bank differ from that in other
financial institutions?
The difference may not be much but
as Stanbic, the VAF product started in
2004 strategically because SBU needed
to broaden its product offerings; to offer
a range of options and deepen financial
penetration in the market. This product
is there to give an alternative form of
financing to the already existing and new
customer; aimed at ensuring the customer has a choice. The issue at the end of
the day is service and being a one stop
shop for your customers.
How are the payments generally structured?
Unlike typical loans that have standardized repayments, for leasing, the repayments are structured to suit the client’s
cash flows. For example, if I am dealing
with an agricultural farmer who has got
two seasons in a year, repayments would
be structured to run with those two seasons. For a school, the repayments would
be structured in a way that payments are
made as and when the school receives
income which is termly. So, the payments are always structured in line with
the client’s income flow.
What are the pre requisites for
an individual or business to
qualify for this service?
The key considerations for a business
are the underlying contracts the business
has, the cash flows, legal status of the
business, financial performance of the
entity, level of debt with other institutions and the business profile of the promoters. In the case of an individual, the
In which situations might you
key thing is to be able to prove that you
advise an individual to seek out have got a clear and dedicated source
this product?
of income that will help you meet your
Any business or individual that would
obligations. It could be you