The short answer
The core difference in one minute
Equipment financing is tied to one purchase. You bring a quote or invoice from the vendor, the funder pays for that equipment, and you repay over a set term. At MFE that term is matched to the useful life of the equipment and is never more than 60 months.
Working capital is cash that lands in your business account. You decide where it goes. Repayment terms are usually shorter, and payments are often weekly or daily rather than monthly.
Read the full side-by-side on Merchant Fund Express: equipment financing vs working capital.
Who each option fits, and who it does not
Equipment financing fits a business that has been open about 6 months or more, knows exactly what it needs to buy, and has a vendor ready to quote. A cleaning company adding a ride-on floor scrubber, a print shop replacing a press, a bakery adding a deck oven.
It does not fit used gear bought from a private seller with no paperwork, soft costs like training or software subscriptions, or a business that needs the cash for something other than the equipment.
Working capital fits a business with steady deposits, commonly from about $17,500 a month for a working capital loan, often 6+ months open and commonly 600+ credit. It covers needs with no single invoice behind them.
It does not fit a long-life purchase if the short term would squeeze weekly cash. Paying off a ten-year machine in nine months is a common and avoidable mistake.
Check what your business qualifies for
Merchant Fund Express reviews equipment financing vs working capital requests from $5,000 to $5,000,000. Scores from 500 are considered, and same-day decisions are common on complete files.
Check funding options with Merchant Fund ExpressHow each one works
- Equipment financing: you send the quote, MFE reviews the business and the equipment, a down payment may be asked, the vendor gets paid, and you make fixed payments over a term up to 60 months.
- Working capital loan: you send 3 to 4 months of business bank statements, ID, a voided check and a short application. If approved, funds go to your account and you repay on a set schedule.
- Splitting: you file both requests together, explaining which dollars are for the asset and which are for launch costs around it.
Illustrative example: a landscaping crew adds a truck and mower package
Illustrative example. These figures are illustrations to show the arithmetic, not offers. Real pricing, terms and amounts come only from a reviewed application.
Assumptions: a commercial landscaping company with about $70,000 in monthly deposits, 3 years open, credit around 660. It needs a $60,000 truck and mower package plus $25,000 for two new crew members and fuel through the spring ramp-up.
| Item | Equipment financing | Working capital loan |
|---|---|---|
| Amount | $60,000 equipment, $6,000 down, $54,000 financed | $25,000 |
| Fee or down payment | $6,000 down payment | $750 origination fee |
| Net cash to the business | $0 (vendor is paid directly) | $24,250 |
| Payment | $1,390 per month for 48 months | $576.92 per week for 52 weeks |
| Total repayment | $66,720 financed plus $6,000 down = $72,720 | $30,000 |
Arithmetic: $1,390 x 48 = $66,720. $30,000 / 52 = $576.92. If the owner had pushed the whole $85,000 into a one-year working capital loan, the weekly payment would have landed on top of the same spring payroll the money was meant to cover.
Funding brings customers. Is your website ready for them?
New equipment usually means you can take on more or bigger jobs, and the customers looking for that work will check your website first. Make sure your services page lists what the new truck or machine lets you do, with a quote form that works on a phone. Cheap Cheap Websites builds professional sites from $399, with Website Care at $30/month for hosting, backups and small edits as your services grow.
What to prepare
- Vendor quote or invoice with make, model, price and whether it is new or used.
- 3 to 4 months of business bank statements.
- Driver's license or other ID, plus a voided business check.
- A short note splitting the request: equipment dollars and working capital dollars.
- For larger requests, recent financials or tax returns.
A complete file often gets a same-day decision, and funding often follows the next business day. That is common, not promised.
When another option, or waiting, is better
If you need flexible access more than a lump sum, a revolving line may beat both. See working capital vs a line of credit. If the equipment purchase can wait until after your busy season, the deposits you build up may qualify you for a larger amount or better terms. If you already carry several advances, read MCA refinance before adding new payments.
Related funding guides
Cheap Cheap Websites builds websites. It does not lend or make funding decisions. Funding is offered by our funding partner, Merchant Fund Express, and every request is subject to its review and approval. Figures on this page are illustrations, not offers. Updated October 15, 2026.