Equipment Finance
Presentation
Sales Representatives
Who we are
Sunlyn (Pty) Ltd is a market leader with numerous years
experience, specialising in Rental Finance Solutions.
We strive for and achieve standards of excellence in every
sphere of our activities, both market related and internally
focused. We also develop a deep understanding of the
individual needs of each of our clients to whom we deliver
tailored solutions, and in so doing, achieve our performance
objectives.
Why Sunlyn
• Can offer clients a total solution package
• We have incentive schemes in place
• Branches countrywide
• Secure & protected supplier client base
• Ability to finance entire spectrum
• Finance deals ranging from R10 000 upwards
• High levels of personal service
• Relationship with account executive
• Sunlyn is 40.10% Black owned
• Preferential settlements on upgrade
• Supplier customisation
• Excellent reputable reputation
• Exceptional turnaround times
Benefits of Rentals for Supplier
• Rentals offer your prospective buyer an inexpensive way to have use of the equipment he
wants now without the capital outlay.
• By quoting a monthly rental rather than a full cash price, the equipment appears more
affordable.
• Your client is saved the time and inconvenience of arranging finance by way of lease or
instalment sale.
• The rental agreement can be signed, subject to an approval, thereby securing the deal
• And reducing the client’s need to compare prices with competitors.
• The monthly rental can be trimmed to suite your client’s pocket by use of an annual
escalation of up to 15%
• Better profit margins can be achieved, as cash discounts are not often discussed when
quoting a rental.
• Your client base is protected because the client is tied to a Rental Agreement. Should the
client wish to settle, Sunlyn will notify the Supplier, thereby providing you with the
opportunity to renegotiate.
• Due to there being no need to carry Debtors, cash flow and bad debts are improved.
• Finance charges and interest rates are not disclosed on the Rental Agreements, thus
avoiding conflicts of interest rates charged.
• Company logos may be printed on Rental Agreements, thereby projecting the image of an
internal finance structure.
Benefits of Rentals for Client
• Rentals are fully tax deductible, thereby minimising income tax obligations.
• “Off Balance Sheet” rentals may be structured, and may be shown as an operating expense
thus improving gearing ratios. This provides an added advantage to foreign owned companies.
• Rentals avoid capital expenditure approvals.
• No deposit is required, thus reducing the client’s cash outlay.
• Monthly rentals can be reduced by the use of annual escalations of up to 15%, thereby easing
the client’s immediate cash flow.
• The customer has the option to upgrade the equipment during the contract, thereby providing
flexibility to change as technology improves, or as the company outgrows the equipment.
VAT IMPLICATIONS:
• VAT is not capitalised up front but rather paid monthly with each rental.
• VAT on the rental will be regarded as Input VAT and may be written off against any
Output VAT collected.
Equipment Finance Products
Comparison of Equipment Finance Products
Rental Agreement Types
In addition to supplier facilities categorising Suppliers and allowing qualified
suppliers to run their own collections, Sunlyn offers different agreement types to
facilitate complete transactions for the client and the supplier.
The basic agreement types used:
Master Agreement of Hire: This agreement is used for any company with a
turnover or net asset value of more than R2 Million per annum.
Small Business Agreement: This agreement is used for any company with a
turnover or net asset value of less than R2 Million per annum, accommodating
the provisions of the CPA which this type of clientele would qualify under.
Sole Proprietor Agreement: In view of South Africa’s successful credit
regulation policies, all sole proprietors sign a unique Sasfin Bank Limited
agreement allowing for FICA and CPA governance
Rental Agreement Types (cont.)
Sunlyn (Pty) Ltd also makes use of certain unique Agreements which allows the
supplier to structure a complete solution for the client.
Hire and Service Agreement: This agreement allows us to collect the rental
payable by the client for the equipment and in addition to this we collect a set
maintenance portion on behalf of the supplier and pay this across to the
supplier one month in arrears (25th monthly).
Recourse Facility: This allows the supplier to sign recourse on behalf of one of
their client that would normally not qualify for finance, eg if their financials do
not support or there is adverse information (judgments / adverse trade
reference) on the client.
Rental Agreement Types (cont.)
Residual Value: This allow the supplier to offer more affordable pricing structure
and to be more competitive and more with other supplier. Residual Value is
payable by the Supplier at the end of the term (eg if the contract term was 60
months, the supplier will be liable to pay the residual value in month 61).
South African Company Types
Company Structures that don’t enjoy limited liability (no separation is made between assets and liabilities of company and owner/shareholders)
Sole Proprietor – Any individual can run a business trading under his/her own name. As there is no separation between sole proprietor’s personal assets and
liabilities and those of his business, he benefits from all the profits and assets accumulated through his business. However, he is also held personally liable for any
debts that the business incurs and as such cannot enjoy limited liability.
Partnership - A group of people can form a partnership as long as there are at least 2 and no more than 20 Partners. A partnership agreement is compiled and
signed in agreement by the partners outlining the conditions of the partnership (salaries, responsibilities, payment arrangements, profit share, etc.)Al Partners are
responsible for all debt and as such they also do not enjoy limited liability.
Entities classified as distinct juristic persons enjoying limited liability (separation made between assets and liabilities of company and owner/shareholders)
Private Company (Pty) Ltd – this business entity may be founded and managed by just one and no more than 50 directors and must have at least one but no more
than 50 shareholders.
Incorporation (Inc.) – a personal liability company in which the current and previous directors can be held jointly and severally responsible for any debts and
liabilities which has occurred in their time as Directors.
Public Company(Ltd.) –Public Companies need to exercise responsibility towards its shareholders as these companies offer the sale of shares in their company to
any member of the public at a value price. The day to day management of these companies is undertaken by a board of directors which is elected.
These companies are normally listed on a stock exchange.
Parastatal or State owned Companies – a business entity that may trade for a profit but is partly or wholly owned by the state. Eskom, Telkom, SABC
Section 21 company an association that does not share in the profits of the company. All expenses including salaries are covered by the company but no profits
will be shared
South African Company Types
Consumer Protection Act
FICA
Rate Sheet
Effective Date
February 3, 2014
Escalation R 100,000 R 1,000,000
Period Plus Plus
% Exclusive Exclusive
DOC FEE R 2,000.00 R 2,000.00
0 0.03367 0.03333
36 10 0.03079 0.03046
Months 12 0.03025 0.02992
15 0.02947 0.02915
0 0.02690 0.02654
48 10 0.02356 0.02323
Months 12 0.02295 0.02262
15 0.02207 0.02174
0 0.02288 0.02251
60 10 0.01923 0.01889
Months 12 0.01857 0.01824
15 0.01763 0.01730
E. & O .E.
IMPORTANT NOTES
1. This factor sheet is exclusive of VAT, all calculations must be exclusive of VAT.
2. Factors are excluding insurance and are subject to change without notification.
3. Proof of Insurance is required.
4. If no debit order is signed, R30 (incl VAT) must be added to the rental amount (Subject to credit approval)
5. Documentation Fee. R 2,000.00 (Excl VAT) per transaction as shown above
This must either be collected upfront from the client, alternatively we can add to your invoice and deduct from payout
6. All quotations are subject to approval
How to calculate a Rental
Taking a transaction of R100 000.00, over 60 months, 0% escalation:
• Capital (Incl. doc Fee) x Factor = Rental
Eg. R102,000.00 x 0.02288 = R2,333.76
• Factor x Capital (Incl. doc Fee) = Rental
Eg. 0.02288 x R102,000.00 = R2,333.76
Do not quote the client on the full cost amount, but rather quote a monthly
rental that appears more affordable.
We don’t use affect on clients existing credit lines
Escalations – Pro`s & Con`s
Taking a transaction of R102 000.00 (Incl. doc Fee), over 60 months
A.0% Escalation
R2,333.76 p.m. @ 0% escalation x 60 months
Equals = R 140,025.60
B.15% Escalation
60 months with 15% escalation p.a.
year 1 – R1,798.26 Equals = R 21,579.12
year 2 – R2,068.00 Equals = R 24,816.00
year 3 – R2,378.20 Equals = R 28,538.40
year 4 - R2,734.93 Equals = R 32,819.16
year 5 - R3,145.17 Equals = R 37,742.04
Total over 60 months Equals = R145,494.72
What is required for an application:
A good rule of thumb to remember is that the more information received upfront the
quicker and more efficiently we can make a decision.
The following must be provided in order to assess the transaction:
• Completed and Signed Application form (authorizing credit checks and confirming
turnover or Net Asset Value (NAV)
• Latest Audited / Signed off Financial statements not older than 15 months as well
as latest managements
The following additional information may be requested:
• Statement of assets and liabilities for members / directors / shareholders
• Company profile and background on the members / directors / shareholders
Companies with a turnover or Net Asset Value (NAV) of less than R2 Million is
required to be signed on Small Business Agreements.
Sole proprietors can only be done through Sasfin Bank Limited (Complete Sole
Proprietors client application form)
Customers considered for finance:
Client Criteria
• We consider businesses that have been trading for more than 4 years
• We look at the strength of the balance sheet first, the client must be solvent, liquid and
have sufficient equity to cover the transaction.
• Income statements must show stability
Which Customers are generally not considered for finance:
• Adverse and Judgements - Regarded in negative light
• We will generally not consider clients that make repeated losses.
Sunlyn will not finance illegal practices as well as practices that are regarded as
immoral.
In terms of the International Finance Corporation (IFC) we have specific limitations
in certain industries including but not limited to, Arms Manufactures, The Tobacco
Industries and gambling/sports betting.
Once approved, other documents required
from the client and the function of each of the
documents:
• Signed and fully completed Rental Agreement (including the schedule/s and
Authority to pay letter thereto)
• Company resolution – this is required if the signatory on the contract does not
reflect on CIPC as a director. We require proof that the person signing the
rental agreement has the authority to bind the company.
• Acceptable Social and Environmental Checklist to be completed. This is a
requirement from the Industrial Development Corporation (IDC) for
environmental awareness.
• Confirmation of turnover – as per the Credit Protection Act (CPA) we require
the confirmation of turnover or Net Asset Value (NAV) to establish which
agreement should be signed
• Proof of Banking Details / Cancelled cheque
• Landlord and Insurance Details
• Signatory’s ID copy
Approval conditions:
• Approval conditions that need to be met before deal activation will be noted on the
approval form / report.
• Approval is only valid for 3 months
• Sunlyn will only finance the equipment and make for which the Supplier is approved for
(eg. Forklift – Doosan make)
Process if terms and conditions are altered on the
Rental Agreement and how they should be altered:
Any variation to the standard terms and conditions must be submitted to us for consideration
and approval. We will enter into negotiations with the client to come to Terms for the
Agreement.
Requirements Prior to Payout
• Completed original Rental Agreement
• Acceptable Social and Environmental Checklist
• Original invoice
• Landlord details
• Insurance details
• Complete installation of equipment and client to acknowledge that all is
in order
• All approval conditions to be met
Note: Unsigned alterations and / or amendments to
Rental agreements as well as agreements that
contain correction fluid will not be accepted for
processing
Sunlyn Invoice Instructions
TO:
SUNLYN (PTY) LTD
29 SCOTT STREET
WAVERLEY
VAT: 4410120689
TO BE DELIVERED ON YOUR BEHALF TO:
Client Name: (Full legal name and Entity)
Physical Address: (Exact address where equipment will be delivered)
VAT: ____________
Full description of goods and serial numbers.
Amount – (remember to include R2,000 (Exc. VAT) documentation fee)
Supplier Full Name and Legal Entity
Registration number
VAT number
Banking details
Physical address
Contact numbers
Sasfin Invoice Instructions
Only on Sole Proprietors
TO:
Sasfin Bank Limited
29 SCOTT STREET
WAVERLEY
VAT: 4960103515
TO BE DELIVERED ON YOUR BEHALF TO:
Client Name: (Full legal name and Entity)
Physical Address: (Exact address where equipment will be delivered)
VAT: ____________
Full description of goods and serial numbers.
Amount – (remember to include R2,000 (Exc. VAT) documentation fee)
Supplier Full Name and Legal Entity
Registration number
VAT number
Banking details
Physical Address
Contact Numbers
Once deal was activated
• Ownership will reverts back to supplier at end of term of contract. Supplier pay a minimum
ownership fee of R1,500 (excl Vat).
It is up to the supplier to decide if:
They want to pass ownership to the client (Sunlyn does not get involved in passing
ownership to client.)
Keep the equipment to create secondary income by renting it for example on a short term
rental.
• Client / supplier to give one calendar month’s of term prior to the expiry of the rental agreement. If
no notice is received the rental will continue until notice of termination is received, unless a
residual value is applicable.
• Sunlyn cedes all right, titel and interest in and to the rental agreement to Sasfin Bank Limited
• Sasfin will invoice client and debit order will be through Sasfin – all Sunlyn deals are 100% ceded
upfront to Sasfin.
Settlements
• Normal Settlement: (Non-Upgrade)
1) Rental x Period
a. Will bind the client if he / she wants to settle deal
b. Will inform Supplier before settlement, so that supplier can offer client
new equipment.
• Upgradable Settlement:
1) Preferential rate @ NPV when client wants to upgrade with existing
supplier for bigger / latest equipment. Ensuring that they use same
supplier.
2) Include the suppliers right of ownership in and to the “old” goods.
Besides the current discounting – other
finance options you offer:
Through Sasfin Bank Limited we can offer the following facilities:
Looking Forward to a mutual beneficial
relationship
[email protected]Contact: Taryn Gough
Email:
[email protected]Tel: (011) 445 8044
Cel: 082 419 8165
