ICT leasing for schools has been in the media a lot recently. That’s because almost one in two schools appreciates the benefit of technology and is looking to invest or upgrade. The best way to do this is often via leasing.
But what’s also been hitting the headlines is the fact that if leasing isn’t arranged with a provider who knows what they’re doing, schools can find themselves in hot water with the wrong kind of lease.
Some schools have been mis-sold a finance lease when funding IT. This is not permissible under the Education Act. IT finance has to come in the form of an operating lease, which is permitted under the Education Act.
Why transparency matters
A provider that understands compliance issues around funding for schools is key. That way the school gets the right kind of lease and no-one gets in trouble. The other stand out benefit a provider can offer is transparency.
Many unscrupulous leasing agents do not reveal the true costs of rental upfront. They make returning equipment difficult and more costly than anticipated when the lease is taken out in good faith. Plus they may offer unrealistic residual values for the equipment. All of these things need checking before a lease is taken out.
If a school is considering leasing IT, schools should revise their provider carefully.
It pays to do homework on providers
There are lots of reasons why leasing is a good way to access the latest technology. With budgets constantly squeezed, schools often aren’t able to find the capital to buy outright. The correct type of lease can offer a value for money means to get the equipment a school needs, at a lower lifetime cost.
A provider that knows what they’re doing will offer ICT funding in the form of an operating lease, which is permitted under the Education Act. There are also some other things to look out for when leasing ICT.
Schools need to know exactly what they’re paying for their lease – both at the beginning and when they give back the equipment – if that’s what they’re planning on doing. They need to know up front; the cost of the funds, how much the rental will be if they extend beyond the initial contract period, how easy it is to give back the equipment, whether there are any penalties for late delivery and whether they’ll have to pay for data cleansing to ensure peace of mind for data protection.
Schools should also find out the minimum leasing period and weigh this up against likely changes in their needs and the possibility that the equipment may become less reliable. The shorter the leasing period, the less likely it is that the school has to make rental payments when the equipment is no longer suitable.
Interested in hearing more about leasing for schools? Get in touch