16 01732 759725 Simon Everidge FINANCE customers are increasingly looking for finance-as-a-service for technical solutions in the cloud. With ‘everything-as-a-service’ funding structures, companies no longer have to buy an asset, licences, separate services and separate maintenance agreements. Everything comes under one roof and the cost of paying for that holistic suite is spread over the useful life of the project through regular single payments – without upfront capital investment. ESG included At Rigby Capital, we recognise that many new IT assets will have a secondary and perhaps even a tertiary life beyond the initial period of use by the primary user and for many years have factored in the potential future value of that in the way we structure our funding models. Now, in a ground-breaking partnership with managed IT services provider SCC, part of the Rigby Group, and asset finance provider Lombard, we have taken this further by developing a new subscription service that, as well as managing customers’ cost outlays, ensures equipment is efficiently recycled, remarketed or refurbished at end of term through SCC’s recycling arm, SCC Recyclea. In this way, we hope to prevent more than one million devices from ending up in landfill over the next five years. I am confident that by addressing customers’ ESG needs and providing genuine all-inclusive ‘as-a-service’ finance solutions, not just leases under a new name, we have created a solution fit for the modern era that will enable clients to seize the opportunities presented by cloud computing while meeting their responsibilities as good corporate citizens. www.rigbycapital.com have the option to purchase the asset, extend the lease or return the asset to the financing source. Everything as a service IT infrastructure can require significant upfront capital expenditures for purchasing servers, storage and networking equipment, as well as PCs, laptops, tablets and mobile phones. Those investments, if paid for over time, were typically transacted under one of the financing models described above. With the rise of cloud computing, businesses now have another option, which is to subscribe to cloud services on a pay-as-you-go basis, which also reduces the financial burden of acquiring and maintaining onpremises hardware. As we move firmly into the era of ‘everything-as-a-service’, companies are keen to take advantage of a one-stop shop approach – they want to get the technology, the solution and the funding through their partnership with a supplier. As such, they are moving away from traditional third-party leasing solutions with an independent funder to one-stop shopping from their single-source supplier. They also want to consume their technology on a subscription. Rather than buying an asset and then depreciating it over time, the technology world is moving to software and hardware infrastructure in the cloud. Such services offer unparalleled scalability, allowing organisations, especially those with fluctuating workloads or those experiencing rapid growth, to adjust IT resources based on demand. Traditional methods of funding assets don’t work well for these cloud-based solutions, so savvy IT asset finance has evolved beyond simply funding technology purchases. Today, it encompasses the holistic management of IT assets throughout their entire lifecycle, with an emphasis on managing end-of-life assets responsibly and efficiently. This shift reflects the changing priorities of organisations as they seek to optimise costs, enhance sustainability and address security and compliance considerations in their IT operations. The traditional asset finance model allows individuals and businesses to acquire assets, such as IT hardware and software, without having to pay for them in full, upfront. The customer buys everything from their supplier and finances their acquisition through a third-party funder that may or may not have a relationship with that supplier. In the case of a loan or Hire Purchase agreement, the financing source provides the funds necessary to purchase the asset and the borrower makes regular payments, typically covering principal funds and interest, over a defined period. In a lease agreement, the financing source acquires the asset and leases it to the borrower for a predetermined lease term, with fixed lease payments. With traditional financing in place, the asset is acquired by the borrower or lessee. Ownership often remains with the financing source until the full loan amount or lease term is completed. At the end of the financing agreement or lease term, the borrower or lessee has several options. Where they had a loan or Hire Purchase arrangement, they gain full ownership of the asset; and where they had a lease, they may IT asset finance evolves to include ESG Simon Everidge, Managing Director of technology financing specialist Rigby Capital, says it’s time to consider ESG in IT financing arrangements Traditional methods of funding assets don’t work well for cloud-based solutions, so savvy customers are looking to financeas-a-service for technical solutions in the cloud
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