Scheme equips recycling firms with vital facilities
A scheme to promote lease finance in the recycling sector has delivered its biggest deal to date, worth £430,000, according to organiser the Waste and Resources Action Programme (WRAP).Part of the organisation's eQuip scheme, the deal brings the total amount of lending arranged to over £1.5 million, and has helped South Herts Waste Management (SHWM) establish a materials recycling facility (MRF) to support a kerbside collection contract for a local authority in Nottinghamshire.
According to WRAP, SHWM is leasing a turnkey solution to sort plastic, paper, glass and metal waste collected from private homes and businesses. The Bank of Scotland Corporate will provide the lease finance following help from the eQuip scheme.
"Being able to lease this equipment is a big help with cash flow and, as the residual values are guaranteed by eQuip, the finance provider is able to offer more competitive lease terms," SHWM finance director Del Dervish explained.
He said that the eQuip deal marked the latest development in a successful period of growth that had seen the company establish recycling sites and services throughout the UK, raising SHWM's annual turnover to around £20 million.
"The whole vision of this business is based on research and development, so we can introduce better ways of recycling more materials," Mr Dervish continued. "Our recycling percentages are often double those of other UK companies because of our approach and attention to detail."
"We invest in a lot of new equipment, updating and replacing machinery to keep ahead of the game. Leasing helps us to spread those costs - unless you are very wealthy, one of the best routes open to you is asset finance when you are spending millions of pounds on new kit."
Investments manager for WRAP, Susannah McClintock said that the scheme was vital to helping companies in the recycling sector expand their business - benefiting the industry as a whole as well as their business.
"Historically, lessors have been reluctant to finance new technologies in unfamiliar sectors," Ms McClintock stated. "By guaranteeing the residual value of the equipment, this scheme makes leasing easier for both recycling companies and finance providers."
By Jane Kettle