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