Equipment Finance Rates in Australia: What You'll Actually Pay in 2026

Equipment finance rates in Australia start from 6.59% p.a. and range up to 15% depending on your business profile, asset condition, and documentation level. An established business buying new equipment with full financials will pay closer to that floor. A start-up on a low doc basis will sit near the top. Here is how to work out where you fall.

Why equipment finance rates have shifted in 2026

The Reserve Bank of Australia raised the cash rate to 4.35% in May 2026, up from 4.10%, pushing borrowing costs higher across all business lending. Equipment finance rates tend to track the cash rate with a margin on top, so most lenders adjusted their pricing in the weeks after the announcement. At the same time, demand for equipment finance is strong: the ABS reported that business investment in equipment and machinery rose 11.5% in the December 2025 quarter, with non-mining sectors up 13.0%. More businesses are competing for finance, but lenders are pricing more carefully in a higher-rate environment.

What equipment finance rates look like right now

The range of 6.59% to 15% is real, but it is not useful without context. The table below breaks it down by business profile so you can see where your situation sits.

These ranges reflect secured equipment finance where the asset itself is used as security. Unsecured options exist but typically carry rates 3% to 5% higher and are capped at lower loan amounts.

Rates are subject to lender approval, terms, and conditions apply.

Five factors that determine your equipment finance rate

1. Time in business

Lenders view trading history as a proxy for stability. Businesses operating for three or more years with consistent revenue will access the most competitive rates. Below two years, the pool of lenders narrows and rates rise because the risk profile changes. Some lenders accept businesses trading for as little as six months, but expect to pay a premium of 1% to 3% over the rates available to established operators.

2. Documentation level

A full doc application includes two years of financial statements, tax returns, and an ATO portal download. This gives lenders the clearest picture of your capacity and earns the lowest rates. A low doc application replaces full financials with three to six months of business bank statements and your most recent BAS. The trade-off is typically 0.5 to 1.5 percentage points added to the rate. For businesses with strong bank statement cash flow, some lenders will match full doc pricing on a low doc basis.

3. New versus used equipment

New equipment attracts lower rates because it holds its value as security. A lender financing a new excavator knows it has predictable depreciation and a ready resale market. Used equipment, particularly items over five years old, introduces more uncertainty about residual value. The typical rate gap between new and used is 1 to 2 percentage points, widening for older or more specialised items.

4. Deposit

Putting down 10% to 20% of the purchase price reduces the lender's exposure and signals your commitment. A meaningful deposit can improve your rate by 0.5% to 1.5%. For newer businesses or those with credit marks, a larger deposit often makes the difference between approval and decline. Most equipment finance is available at 100% loan-to-value, but choosing to contribute a deposit gives you leverage on pricing.

5. Asset type and industry

Not all equipment is equal in a lender's eyes. Mainstream assets with strong resale demand, such as trucks, earthmoving machinery, and forklifts, attract the best rates. The transport and warehousing sector saw equipment investment rise 40.7% in the December 2025 quarter (ABS), which keeps the secondary market liquid and lenders comfortable. Niche or single-purpose equipment with limited resale, like specialised medical devices or custom manufacturing rigs, often attracts higher rates or lower advance limits.

How different finance structures affect your rate

The rate you see depends partly on which structure you choose. Here is how the main options compare.

For most GST-registered businesses buying equipment they intend to keep, a chattel mortgage or hire purchase will offer the lowest rate and the best tax position. Finance leases and rentals suit businesses that want to keep the asset off their balance sheet or prefer to upgrade on a fixed cycle.

What a $100,000 asset actually costs at different rates

The rate gap matters more than most people expect. Here is what a $100,000 piece of equipment costs over a five-year term at three different rates, with no balloon payment.

The difference between 6.59% and 12% on a $100,000 loan is $15,900 in extra interest over five years. That is roughly $265 per month in additional cost. If you are financing a fleet of three assets, the gap triples. This is why getting the rate right matters more than almost any other variable in the transaction.

These figures are illustrative. Subject to lender approval, terms, and conditions apply.

How to get a lower equipment finance rate

There are practical steps you can take before you apply.

Prepare your financials. Switching from low doc to full doc can save you 0.5% to 1.5%. If your accountant can have your financial statements ready, the rate improvement often more than covers their fee.

Offer a deposit. Even 10% changes the equation. On a $100,000 asset, a $10,000 deposit reduces the financed amount and can shift you into a lower rate tier.

Choose your timing. EOFY is the busiest period for equipment finance. Lenders are writing volume and some offer rate specials to hit targets. Equally, buying in a slower quarter (January to March) can give brokers more room to negotiate.

Compare across the market. Equipment finance rates can vary by 3% to 5% between lenders for the same transaction. A broker who searches across a broad panel, rather than going to a single bank, will surface the most competitive option for your profile.

Finance newer equipment. If you have the choice between a new and a five-year-old asset at similar prices, the new asset will attract a better rate and hold its value longer as security.

This article is general information only and is not financial advice.