Finance lease or operating lease: which formula for your company car?

When choosing a car, it’s not just about the brand, model and options. You also need to think about how you’ll finance it:

• Buying it with your own funds or a loan*
• Taking out an operating lease with Arval**
• Taking out a finance lease***

Important: remember to estimate all the costs relating to your transport needs, such as the cost of buying a car, maintenance, insurance and tax.

Compare the different financing solutions and make your choice based on the overall cost.

Finance leases and operating leases: what’s the difference?

The same logic applies to both finance leases and operating leases: you pay a rental fee to a leasing company for a set period, usually four or five years.
In both cases, the leasing company is the legal owner of the vehicle. However, depending on your contract, you may have an option to buy the vehicle at the end of the lease.
In the case of a finance lease, the amount you’ll pay under the purchase option is known from the start. In the case of an operating lease, the amount is determined at the end of the lease based on the market value of the car.

Let’s summarise the different advantages of each formula.

Operating leases with Arval

BNP Paribas Fortis and Arval offer operating leases, which are a flexible solution for businesses.

With this formula, Arval remains the owner of the vehicle. You rent the car for a fixed monthly price, without any obligation to purchase at the end of the lease period. Arval, your transport partner, takes care of the administrative formalities, from ordering the vehicle to delivering it.

Your benefits:

• All-in formula 
  You pay a fixed monthly amount that includes maintenance, insurance, assistance and breakdown services
• Tax benefits 
  The monthly amount, including VAT, is directly accounted for as expenses, so your company’s solvency is protected. You also don’t need to pay all the VAT on the vehicle up front, as it’s included in the monthly rental fee.
• Customisation 

You choose your car, new or used, and the lease period. An operating lease adapts to your budget and accounting needs. There’s also a purchase option at the end of the contract. Find out everything you need to know about operating leases.

Finance leases with BNP Paribas Fortis

With a finance lease, you can become the owner of the vehicle at the end of the contract. Our leasing company purchases the vehicle, and at the end of the lease, you can buy it. The driver is responsible for maintenance and insurance.

Your benefits:

• In most cases, you don’t need to dip into your capital.
• You have minimal administrative tasks.
• You can rent a range of equipment for your business, including cars and bicycles.
• At the end of the lease, you can buy the vehicle using the purchase option or extend the lease by one or two years.
• You can depreciate the vehicle over the entire lease period.

Additionally, the term of the lease depends on the economic lifespan of the vehicle, which is flexible in terms of duration and residual value. Discover everything you need to know about finance leases.
Finance lease or operating lease: how to choose?

Reasons to choose an operating lease with Arval

• You’re looking for a simple and hassle-free solution that includes all services.
• You want to manage your vehicle or fleet without tying up capital or having to think about resale.
• You want maximum flexibility, including the possibility of changing vehicles regularly without becoming the owner.

Reasons to choose a finance lease

• You want to become the owner of the vehicle at the end of the contract.
• You’re willing to take care of maintenance and other expenses, so the formula is similar to buying the vehicle.
• You want a means of transportation with the possibility of keeping it long-term.

Conclusion

So should you choose a loan or a lease? It depends on what you want. Compare loans and leasing formulas for your business vehicles and use the loan simulator.

Compare all formulas in table format

Legal information

*Subject to acceptance of your application by BNP Paribas Fortis S.A., Montagne du Parc 3, B-1000 Brussels - RPM Brussels - VAT BE 0403.199.702, approved intermediary registered with the FSMA under number 25.879A.

For insurance, BNP Paribas Fortis SA, Montagne du Parc 3, 1000 Brussels – RPM Brussels – VAT BE 0403.199.702, is registered under number 25.879A with the FSMA, rue du Congrès 12-14, 1000 Brussels, and acts as a tied insurance agent for AG SA.

The information provided here is for information purposes only and does not imply an offer or promise of credit. It is intended to form the basis of further discussions. The bank reserves the right to modify the information on its website without prior notice and has no obligation to inform customers (existing or potential) of such changes.

**Lessor: Arval Belgium SA, Ikaroslaan 99, 1930 Zaventem – RPM Brussels – VAT BE 0436.781.102, insurance intermediary registered with the FSMA under number 047238 A. Subject to acceptance of your application.

***Lessor: ES Finance SA (trading name: BNP Paribas Leasing Solutions), Chaussée de Gand 1440, 1082 Brussels, RPM Brussels, VAT BE 0430.506.289.