Leasing IT systems, instead of buying them outright, could result in cost savings of between 10 and 25pc for many organisations, the country’s largest bank has said.
According to AIB’s corporate banking division, which provides technology financing agreements under the brand AIBIT, businesses and public sector organisations could upgrade their IT systems without large capital investments.
“The fact is, almost half of the companies in Ireland are predicting higher IT expenditure this year, with medium-sized and large companies forecasting some of the most significant growth,” said Cathal O’Connor, senior product manager for AIB Corporate Banking Ireland. “Technology infrastructure has become a critical business asset for the majority of organisations, making leasing an attractive option for companies hoping to keep IT costs down,” he added.
“For most customers, AIBIT can deliver savings of between 10pc and 25pc on the costs associated with IT equipment, over a two to three year period,” said O’Connor.
In the US, the IT equipment financing market is valued at an estimated US$40bn per year, up by close to two thirds from three years ago. AIBIT said that the IT leasing market in Ireland has grown in line with trends elsewhere in Europe.
“Top executives in business, including CEOs and CFOs, are now carefully watching the cost of IT equipment acquisitions and are making IT spending an integral part of the capital budgeting process,” said Valerie O’Keeffe, senior manager with AIB. She claimed that it was becoming harder to delay implementations of new technology because of the speed at which new technology comes to the market.
AIBIT said its deals cover finance for any IT-related equipment as part of an upgrade or project, including PCs, printers, servers, storage or data networking infrastructure. Once the term of the lease expires, customers can choose to buy the leased equipment outright, enter into a new lease agreement or extend the term of the existing lease. Alternatively, AIBIT can remove and dispose of the technology at the end of the lease term if needed.
By Gordon Smith