Leasing can reduce financial risk by locking in a payment amount, and provides the best protection against technological obsolescence. It preserves cash for stronger balance sheets and enhances financial ratios tied to bank covenants, thus enabling your customer to keep bank lines open for working capital needs. The monthly payment is tax deductible as an operating expense, because there is no ownership until the buyout option is exercised. At the end of the lease, the equipment may be purchased, the lease renewed, or the equipment returned.