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American Express Business Finance

By: EconomyWatch Date: 30 June 2010

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The American Express Business Finance Corporation is a segment of American Express whose purpose is the provision of quick and dependable finances for the purchase of business equipments. Such financing takes place through the vendor partners.

Acquisition by Key Equipment Finance

Key Equipment Finance which heads the equipment leasing business is a subsidiary of KeyCorp . Only recently, in 2004, there was an agreement between Key Equipment Finance and the American Express Company which led to the acquisition of the American Express Business Finance. The name of American Express Business Finance was transformed to American Equipment Leasing(AEL ) Business Finance.

Business lines of credit offered by American Express Small Business Finance

The American Express Business lines of credit has the following features:

Competitive Annual Percentage Rates(APR)

The APR is very low . It is Prime Rate +1.99% to Prime Rate +4.99%.

Financing according to need

Businesses can avail finances tailoring their needs. The finances vary from a minimum of $10,000 to a maximum of $100,000.

Financial Flexibility

The businessman has the option of paying the full amount due each month or the minimum due or can choose from any amount due each month.

Membership Rewards

Membership Reward points may be earned by availing the Line of Credit facility with the help of the credit card.

Other benefits include accessing the line of credit in three different ways i.e. Either free, business size checks or the electronic funds transfer

The annual fee or the interest payments may be tax deductible.

The American Equipment Leasing Business Finance which was previously known as the American Express Business Finance uses the method of leasing for financing business equipments.

The companies opting for the lease finance of American Equipment Leasing Business Finance have the full independence to choose from a wide array of leasing structures and in the process optimize the flow of cash and future business opportunities. The types of lease provided by the American Express Business Finance can be listed as under:

Capital Leases : The capital leases offered by the American Express Business Finance can be structured. Capital lease cover 10% of the equipment cost.
Fair Market Value Leases: If a company is looking for technology equipments that are outdated in less than 3 years time then it may opt for the Fair Market Value Leases offered by the American Express Business Finance.
TRAC Leases : These leases cater to the fleet and transportation needs.
Operating Leases: The company that would be taking this lease has the option indulging in off balance sheet financing.

Leasing provides the following advantages:

Leasing provides cent percent financing. All the costs including installation, shipping, training and service contracts can be financed.

Leasing provides capital that can be used for investment purposes.
Leasing provides additional credit that is used to meet present and future needs.
Leasing capital can be used as working capital for the slack periods.
Leasing capital can be used to invest in land and businesses.
Leasing capital is used to finance items that would not have been financed otherwise.
Leasing increases the purchasing power by extending the exposure limits.
Leasing helps to avoid technological obsolescence by encouraging the purchase of technologically superior equipments and also the up gradation of equipments.
Leasing also provides tax benefits.
Leasing brings stability in the budget due to its fixed payment structure throughout the leasing term.
As the business needs go on changing, leasing also changes and in the process caters to the different business needs.

To gain more knowledge regarding the working of the American Business Finance Sites like aelbf.com, kefonline.com, americanexpress.com are worth viewing.