The benefits and advantages of asset based lending are unlimited. Lenders don’t focus on the business’s credit-worthiness or track record and thus startups can easily obtain funding. Moreover, businesses don’t have to wait for long to obtain loans since asset financing offers much quicker and less credit quality financial capital than the normal traditional financing options. Even the terms of lending can be crafted by the lender to suit the business industry among other beneficial agreement terms.
Asset financing disadvantages
The drawbacks of asset financing include higher rates compared to normal loan services and also the security of the loans allows lenders to legally repossess the assets in cases where the business is unable to meet payment deadlines or misses payments.