Don’t want to pay any interest? Pay cash for your new equipment and you can be assured you are paying the lowest “rate”. If you have buckets of extra cash this might be the best thing to do but if you have that much extra capital that means your business is doing very well. What does a business do when generating lots of revenue? Expand the facility, expand the product line, upgrade the production system, get more employees, and invest in new markets which all will help continue to increase sales. Money spent in making your company more efficient or helping it grow is a much better investment than paying for capital equipment and saving a few percent in interest rate. That’s opportunity cost; the lost opportunity of not doing something more productive with your extra cash. The question is not how much interest rate are you paying; it is how much profit you are losing by foregoing a better opportunity.