Why CNC Machine Financing Makes Sense

By | August 27, 2015

CNC Machine Tool Financing and monthly payment options from Crest CapitalYou wouldn’t think an industry like equipment financing lends itself to funny / interesting stories, but the truth of the matter is, it really does. It’s partly because we touch on so many different industries, and also because our clients often tell us funny bank stories. I have one now, and it involves financing CNC machinery.

For those who don’t know, CNC Machinery are machines (usually manufacturing machines) controlled by computer. Think Lathes, Mills, Routers, assemblers, etc. In fact, the “CNC” stands for Computer Numerical Control.

We had a client come to us to finance CNC machinery, and the client admitted that he went to his local bank first, and was turned down cold. And the reason was somewhat funny – you see, this particular bank (a smaller, local bank) doesn’t like to finance “computer equipment” for anything over a very short term, with the reasoning that it is outdated fairly quickly. I personally find that a little counterproductive to what a bank is needed for, but ok, at least it makes some sense.

But this client of ours painstakingly told the bank manager it wasn’t really computer equipment. These machines aren’t controlled by PC’s or anything, and are hardly dependent on the latest version of Windows or whatnot. He tried to explain that the machinery is operated by custom-written software to control the moving parts, feed rate, RPM’s, etc. No different than, say, a car’s computer (ironically, that same bank just introduced a seven year term for auto financing).

But no, the first C in CNC shot it down.  It stood for “computer”, and to the bank, that pretty much sealed (or unsealed) the deal. Of course, most equipment financing companies will have no issue with that first C (or the N or the second C for that matter). We certainly didn’t, which made our customer very happy.

Just goes to show you that sometimes, it’s all in a name. Maybe, to make banks happy, CNC should be changed to PNC (Precision Numerical Control – coined by Fletch himself)

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