Alfa Interview Question: How can asset finance firms o... | Glassdoor

Interview Question

Graduate Consultant Interview

How can asset finance firms offer lower interest rates than

  bank loans
Answer

Interview Answer

1 Answer

3

Because of the risks. When a bank offers a loan there is always the risk of default. The borrower might fail to return the money.
In the case of the asset finance firm, if the client fails to return rental payments, the company will take its asset back which means that it risks less.

Interview Candidate on Feb 1, 2015

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