Equipment leasing company TimePayment is adding a new Web calculator to improve vendors’ ability to manage payments for business equipment, as well as extend sales by optimizing renters’ budgets.

TimePayment has developed a lease payment calculator for registered and approved vendors that enables equipment vendors to articulate individual customer payment options and terms for leases. TimePayments’ calculator is integrated with its credit scoring system, which provides a numerical gauge of a customer’s credit, generally in about two minutes.

"By using the tools, equipment vendors can know how much to offer the lessee and for what price," says Richard Latour, president and CEO of MicroFinancial, the Burlington, Mass.-based parent company of TimePayment.

TimePayment’s lease payment calculator also measures the impact of a vendor’s terms on lease agreements, such as upfront payments or limits on the length of the lease. The calculator produces a monthly payment for every possible credit score for that renter.

"Instead of a lease quote tools showing a monthly payment, the new tools show them how much we would pay for that contract based on a variety of factors for that vendor and the customer," Latour says. "We do risk-adjusted pricing."

MicroFinancial and TimePayment manage leases and other purchase models that businesses use to procure equipment for industries such as auto repair, cleaning equipment, fitness equipment, forklifts, heating and cooling, machine tools, medical equipment, office equipment, point of sale hardware, restaurant supplies, salons and printing. The company also offers equipment financing and credit lines.

Equipment vendors’ sales representatives use TimePayment’s calculator to develop tailored payment plans for their customers, with the goal of including additional equipment leases that fit inside the customer’s equipment budget, Latour says.

"All of that can be accessed through an iPad or a PC in the vendors’ office," Latour says.

TimePayment’s services also includes an automated platform to populate lease documents, which can be signed and submitted to TimePayment, which improves the accuracy of the forms, Latour says.

TimePayment handles payment processing, billing and collection on behalf of vendors, who lease business equipment in transactions ranging in total value from about $500 to $10,000, with most deals in the $4,500 to $5,500 range. TimePayment works through a network of 8,000 equipment vendors, who sell to a customer base of more than 750,000 customers with a total of $1.17 billion in lease originations since the company’s founding in 1986.

By renting equipment, the businesses hope to shave costs on equipment loans, achieve tax benefits since some lease payments are deductible, and manage the changes in technology that can render certain equipment obsolete. Other companies such as SunGard and Oracle offer similar services.

SunGard’s Ambit Asset Finance equipment leasing software enables leasing companies to manage products, partners and applications by consolidating the underlying technology for those functions in a single system, covering industries such as vehicles, computers, business machinery and other equipment. The unified system is designed to aid credit management and decision making through access to broader payments data and simplified workflows for equipment vendor.

The current demand for automated lease payments risk management "isn’t overwhelming," but there is a niche where the services could be useful, says Christine Pratt, a senior analyst at Aite Group. "There may be some smaller companies that would a have a hard time managing that risk," she says.

Oracle’s equipment lease software bundles a vendor’s products to allow the vendor to sell a suite of equipment through the same transaction, as well as a configuration that allows a vendor’s financial products to be offered through a range of lease and loan options. Oracle’s software also captures all transaction and business data in one location and delivers bills and accepts payments based on the user’s requirements or circumstances. It additionally offers Web-based self-service for vendors to enable flexibility when negotiating terms between vendors and business.

Business-to-business payments often lag consumer payments in adopting automation, a gap that has attracted companies such as Bill.com, a company that plugs its payments tools into banks’ small business software. Other companies such as Realex are attempting to boost business payments automation by using social networking.

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