A machinery loan is a type of business financing provided specifically to help companies purchase new machines, upgrade existing equipment, or repair and replace industrial tools and plant machinery.

For example: A manufacturing business might apply for a machinery loan to acquire advanced production equipment or automation tools to improve efficiency and increase output. The amount borrowed is typically repaid in regular instalments with interest, and the loan is often secured by the very machinery being purchased. This kind of loan enables businesses—especially those in manufacturing, processing, or production—to modernize their operations, boost productivity, or expand their capabilities by making the necessary capital investments in technology and equipment.