Equipment Financing in Canada: Loans vs Leases for Your Business

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Whether it’s a dump truck, a commercial oven, a CNC machine or dental chairs, equipment is expensive. Equipment financing lets you get the tools you need now and pay for them as they generate revenue.

📊 Key Canadian figures (verified October 2026)

$1.15 million
Maximum total financing per borrower under the Canada Small Business Financing Program
2.25%
Bank of Canada policy rate, held at its September 2, 2026 decision
$2.68 trillion
Total Canadian consumer debt in Q2 2026, up 4.18% year over year
35% APR
Canada's criminal interest rate cap on most consumer loans since January 1, 2025

Sources listed at the end of this guide.

📘 This article is part of our complete guide to business loans in canada.

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How equipment financing works

The lender pays for the equipment and you repay over a set term — often matched to the equipment’s useful life. Because the equipment is the collateral, approval is often easier and faster than for an unsecured business loan.

What can you finance?

  • Trucks, trailers and fleet vehicles
  • Construction and heavy equipment
  • Restaurant and commercial kitchen equipment
  • Manufacturing and agricultural machinery
  • Medical, dental and salon equipment
  • Computers, servers and software (in some cases)

Equipment loan vs equipment lease

Equipment loan Equipment lease
Ownership You own it Lender owns it during the lease
Down payment Often 0–20% Often low
End of term Equipment is yours Buy out, return or upgrade
Best for Long-life assets Fast-changing technology

What lenders look for

  • Time in business (some lenders accept startups)
  • Personal and business credit
  • Cash flow from bank statements
  • Equipment quote or invoice from the vendor
  • Age and type of equipment (new vs used)

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Working capital, equipment and growth funding for Canadian businesses. Checking your options won’t affect your credit score with most partners.

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What about merchant cash advances?

A merchant cash advance (MCA) isn’t equipment financing — it’s an advance repaid from future card sales. It’s fast, but the cost is often far higher. If you’re buying equipment, a secured equipment loan or lease is usually the cheaper route.

Tips

  • Get multiple quotes from vendors and lenders.
  • Match the term to the equipment’s life — don’t pay for equipment long after it’s worn out.
  • Ask about tax treatment — capital cost allowance (CCA) rules can affect your decision.

LoanWave isn’t a lender. We help Canadian businesses compare financing options for free.

Sources & methodology

This guide was researched and fact-checked by the LoanWave editorial team against Canadian government sources, federal law and national credit bureau data. Figures are the latest published at the time of review; lender rates and terms change often, so always confirm the final cost in your loan agreement. Example calculations use standard amortization formulas and are for illustration only. LoanWave earns referral commissions, but partners do not review or approve our editorial content.

  1. Innovation, Science and Economic Development Canada — Canada Small Business Financing Program
  2. Justice Laws — Canada Small Business Financing Act, s. 7 (maximum loan size)
  3. Bank of Canada — Interest rate announcement, September 2, 2026
  4. Cassels — Changes to Canada's criminal rate of interest (35% APR, Jan 1, 2025)
  5. Wealth Professional — Canada's consumer debt hits $2.68 trillion in Q2 2026 (Equifax data)

Keep reading

Frequently asked questions

Is it easier to get equipment financing than a business loan?

Usually, yes. The equipment secures the financing, so lenders take on less risk and may approve newer businesses or owners with fair credit.

Should I lease or finance equipment?

Financing makes sense for equipment with a long useful life that you want to own. Leasing can suit technology that becomes outdated quickly. Ask your accountant about the tax treatment of each.

Free · 100% online · No obligation

Compare Business Loan Offers

Working capital, equipment and growth funding for Canadian businesses. Checking your options won’t affect your credit score with most partners.

Apply Free in 3 Minutes →

LoanWave.ca is not a lender. You’ll be sent to a third-party partner to apply.

Important: LoanWave.ca is an independent comparison website. We are not a lender, bank, broker or financial institution, and we do not make loans or credit decisions. Rates, amounts and terms are set by third-party lenders and depend on your eligibility. Examples are for illustration only. This article is general information, not financial, legal or tax advice. See our editorial standards and how we make money. Since January 1, 2025, most consumer loans in Canada cannot exceed 35% APR.
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