This article first appeared on ‘Sustainability News’ here

With second-hand marketplaces rising and sustainability regulations tightening, businesses are rethinking their approach to technology procurement. Neil Pein, CEO of BNP Paribas Leasing Solutions, explores how Product-as-a-Service (PaaS) offers a long-term solution to e-waste, affordability, and global shortages – bringing in a new era of circular IT strategies. 

Second-hand marketplaces are booming, with cost and sustainability-conscious consumers flocking to websites and apps for electronics, clothes, homeware, and beauty products. Vinted, traditionally known for second-hand fashion, has recently launched its first dedicated electronics category, attracting customers with pre-loved smartphones, wearable tech, and audio devices.  

This shift extends beyond consumers – businesses, too, are rethinking how they manage, procure, and use technology, particularly as part of a wider push towards reducing e-waste and promoting circular economy practices. 

The IT industry has long been a champion for ‘as-a-service’ models, particularly for areas like cloud computing, software, and infrastructure. But now this model is also emerging as an efficient and sustainable alternative to the traditional ownership model. It’s grounded in an understanding of product lifecycles, offering assets to clients through usage or performance-based contracts instead of outright ownership – aligning IT procurement with sustainability goals, while improving cost efficiency.  

(E-)waste not, want not 

E-waste is one of the biggest causes of environmental harm. A record 62 million tonnes of e-waste was produced in 2022 – up 82% from 2010. By 2030, this is projected to rise to 82 million tonnes. Many of these discarded electronic goods end up in landfill, leaking hazardous materials which seep into soil, air, and water, causing serious environmental damages and health risks. 

A wave of sustainability regulations sweeping across Europe means that more and more businesses are turning to PaaS models to stay both compliant and competitive. Many IT businesses have begun setting ambitious targets to incorporate recycled components into new products and reduce their carbon footprints. Apple has tapped into the ‘recycle, reuse, replace’ attitude, pledging to include 100% recycled cobalt in its batteries by 2025.  

To achieve these targets and cut down e-waste, firms must consider how they can set up closed loop systems that allow customers to return used devices and recycle their components. This requires a shift from outright ownership to an IT procurement model where IT devices are acquired on a contract basis. Here, devices are procured, used, and then recovered for refurbishment and reuse – rather than going straight to landfill after their first lifecycle. Device refurbishment is an integral part of the service, ensuring businesses have a plan to measurably reduce emissions and waste that is built into their IT strategy. 

The hidden costs of new technology production 

The environmental costs of manufacturing new technology can often be overlooked – with its true impact slipping through the gaps somewhat unnoticed. For instance, data centres and electronic production are hugely resource-intensive, consuming vast swathes of energy and water. Annually, a 1-megawatt data centre can use the equivalent of the daily water consumption of around 300,000 people for cooling. Semiconductor manufacturing also has a huge water footprint, with the average chip manufacturing facility consuming 10 million gallons of ultrapure water every day.  

PaaS presents a more long-term solution to these challenges given it supports product lifecycle extension and enhanced device utilisation.  

Part of this includes designing new technology with its end-of-life in mind from the get-go – such as using modular components that allow for easier disassembly, repair, and recycling. This allows them to offer more affordable options to customers, while minimising environmental impact.   

For the cost-conscious buyers 

Embracing circular economy practices in the IT sector also makes financial sense. In Europe, the demand for refurbished smartphones is growing, expected to reach more than 431 million units by 2027 – as consumers seek modern technology more cheaply and sustainability. In the business world, PaaS models allow businesses to tailor their IT procurement strategies to match the needs of their workforce, without incurring high upfront costs. Value-add services, such as maintenance and support, help reduce overall IT expenditure while mitigating compliance, security, and sustainability risks.  

Alongside being costly and environmentally intensive, manufacturing new products is also becoming much more complex for businesses as they grapple with complex supply chains and access to raw materials.  

The global semiconductor chip shortage, kicked off in 2020 by the COVID-19 pandemic, caused knock-on supply issues which continued for more than three years. This brought the need for alternative sourcing strategies under the spotlight, particularly where resources are finite and susceptible to disruption. PaaS models offer a viable solution to ensure that the lights can stay on, while reducing the dependence on volatile supply chains.  

Striving for sustainability and cost efficiency has pushed PaaS models in IT to the forefront. As well as circular end-of-life handling for unwanted devices, PaaS solutions also offer more efficient in-life handling, like proactive maintenance services, to extend product longevity and reduce unnecessary waste. Embedding circularity into IT procurement strategies can play an important role in helping businesses to cut their environmental impact – enabling them to not just stay on the right side of compliance, but drive a more sustainable future. 

This article first appeared on ‘Supply Chain Strategy’ here

Neil Pein, CEO at BNP Paribas Leasing Solutions explains why Europe’s farmers have been dealt a tricky hand, battling economic pressures, population growth, climate change, and rising sustainability demands. He argues that embracing Product-as-a-Service (PaaS) models can democratise access to cutting-edge technology with financial flexibility, paving the way for a resilient and circular future for farming. 

‘Empty shelf syndrome’ has become all too familiar for shoppers across Europe. Shortages are an almost everyday occurrence in food supply – from olive oil, to honey, and more recently, cauliflower and broccoli. But this empty shelf space is more than just a supply chain hiccup: this is a symptom of deeper-rooted problems in farming. 

The farming community is no stranger to hardship – braving unpredictable weather, tight finances, rising production costs, and the demands of the land. Incomes are dropping, and many are being forced to close shop altogether. The European Union (EU) has seen a huge 37% drop in farms since 2005, with 5.3 million farms disappearing over just 15 years.  

At the same time, farmers are facing growing heat to invest in more sustainable farming practices, while many are struggling to make ends meet. 

Tightening regulations, new policy changes, and green subsidies are changing ways of working on farms. Many are racing to play their part in building a more sustainable future – and the stakes are far greater than just keeping shelves full. 

A PaaS-ing trend? 

Farmers are now looking in other directions to manage business risks and costs, while having to tighten their belts. Product-as-a-Service (PaaS) business models are stepping in as a solution to respond to the challenges of modern farming. PaaS models allow customers to pay for the services and outcomes a product can provide, rather than paying for the ownership of the asset itself. For farms, this opens the door to modern, sustainable, and expensive assets which may otherwise be out of reach – such as ground-based sensors, drones, autonomous tractors, or GPS technology. These costs are spread over the contract’s duration, providing financial flexibility, predictable expenses, and the freedom to reinvest in growth. 

PaaS is a win-win for manufacturers, too. Offering PaaS contracts can unlock predictable revenue streams for manufacturers by offering services that span the entire lifecycle of farm machinery. It’s a well-known fact that machinery, like combine harvesters and tractors, comes with a hefty price tag. With long asset lifespans, moving away from one-time sales helps manufacturers to diversify their revenue opportunities and build long-term relationships with farmers.  

The future of farming is circular  

Traditionally, the high cost of equipment has made it tough for farmers to modernise and invest in new, sustainable tools, with steep upfront costs being a major barrier. PaaS solutions are emerging as a way to democratise access to the tools they need to adapt and succeed. The EU’s ‘Farm to Fork’ (F2F) strategy, introduced under the European Green Deal, has added urgency to updating outdated farm machinery and lean into circular economy principles. The F2F strategy aims to shift the current EU food system towards a sustainable model, with ambitious goals to halve the use of pesticides and fertilisers, reduce food loss and waste, and promote more sustainable production and consumption habits.  

Under these goals, pay-per-use contracts for advanced equipment like seeders and sprayers can add real value for farmers. By keeping upfront costs low, PaaS enables farmers to use precision farming methods that comply with the F2F strategy, help manage rising fertiliser costs, as well as protect water, soil, and air quality.  

What’s more, PaaS agreements support sustainability aims by letting manufacturers reclaim valuable materials at the end of a machine’s life. They can also offer options like maintenance and spare parts. This not only supports the circular economy, but also provides a buffer against raw materials price fluctuations and supply chain disruptions. 

Giving farmers tools at their fingertips 

Farmers are familiar with the risk and disruption facing the sector. Across Europe, farmers have been taking to the streets to protest issues like EU subsidy delays and bureaucracy, while in the UK, thousands marched against upcoming inheritance tax changes on agricultural assets over £1mn starting April 2026. 

Pinching pennies, compounded by the growing impacts of climate change – like natural disasters and unpredictable weather patterns – are pushing the adoption of digital tools to the forefront, promising to lower operating costs and improve precision and accuracy. PaaS models leverage digital asset management, giving farmers the data insights to monitor equipment usage and performance like never before. This can span soil moisture levels, temperature fluctuations, and livestock behaviour – offering data at their fingertips to better manage crops, minimise waste, and weather the challenges ahead. 

The future of farming is rooted in a combination of financial flexibility and sustainable practices. With access to cutting-edge tools without the burden of high upfront costs, farmers can meet more stringent sustainability regulations, meet the food security needs of a growing population, and reduce operating costs – ensuring stocked shelves become the norm, rather than the exception.  

The Heavy-Duty Vehicle (HDV) industry plays a crucial role in global logistics, supporting supply chains and meeting the rising demand for deliveries fuelled by e-commerce growth. However, HDVs contribute significantly to greenhouse gas (GHG) emissions, accounting for over a quarter of road transport emissions in the EU. As sustainability pressures mount, the industry must adopt new solutions that balance growth with environmental responsibility.   

A New Approach: Truck-as-a-Service 

Truck-as-a-Service (TaaS) is an innovative business model that shifts the way fleets are procured and managed. Rather than purchasing trucks outright, businesses pay for vehicle usage through flexible contracts, often based on mileage or operational needs. This eliminates the need for high upfront capital investment, making fleet modernisation more accessible.   

TaaS contracts often include value-added services such as maintenance, repairs, and fleet management solutions. By bundling these services, operators can reduce operational costs, improve efficiency, and focus on core business functions. This shift not only benefits fleet owners but also allows manufacturers to generate recurring revenue through long-term service agreements.   

A Rapidly Evolving Industry   

Technological advancements are reshaping the HDV industry, introducing innovations that enhance fleet performance and safety. Digital solutions optimise vehicle usage, reduce fuel consumption, and help prevent collisions. TaaS enables fleet operators to integrate these technologies without the financial strain of purchasing new vehicles.   

One key innovation is telematics, which allows manufacturers to monitor vehicle performance in real time. This data-driven approach enables predictive maintenance, minimizing downtime and reducing unexpected repair costs. By integrating telematics into TaaS contracts, operators gain greater visibility into fleet health, while manufacturers benefit from long-term service engagements.   

A Transition to Net Zero HDV Fleets 

Truck electrification is also becoming an urgent priority for the industry as it seeks to meet ESG compliance requirements and tackle market challenges, such as volatile oil and gas prices. TaaS models can increase demand for electric vehicles, as they help operators to avoid the upfront capital investment of buying a new fleet, by spreading the costs over the lifetime of the vehicles. 

TaaS contracts can also simplify the EV transition by bundling EV batteries, charging infrastructure, installation, and maintenance into one end-to-end contract. Some manufacturers are even extending their TaaS services to offer installation of hydrogen or electric powertrains in existing vehicles as part of innovative refurbishing programmes that extend the life of vehicles and reduce their impact. 

Toward a Circular Economy 

While still evolving, TaaS shows tremendous potential to improve efficiency, reduce costs, and enhance sustainability. By embracing service-based models, fleet operators can modernise their assets, decrease emissions, and align with circular economy principles – creating a more sustainable future for the transportation industry. 

The agricultural sector is undergoing a profound transformation. Driven by technological advancements, environmental pressures, and evolving consumer demands, farmers are facing unprecedented challenges and opportunities. From climate change and labour shortages to the need for increased productivity and sustainability, the modern farmer must navigate a complex and dynamic landscape. 

A new era of agricultural technology 

The past decade has witnessed a surge in agricultural technology, with innovations like: 

• Automation: Autonomous tractors, drones, and robotic systems are automating labour-intensive tasks, improving efficiency and reducing reliance on manual labour. 

• Data analytics: Ground-based sensors, satellite imagery, and AI-powered platforms are providing farmers with real-time data on soil conditions, weather patterns, and crop health, enabling more informed decision-making. 

• Precision agriculture: Technologies like GPS and variable-rate application allow farmers to optimize resource use, minimize waste, and maximize yields. 

• Sustainable practices: Renewable energy sources, regenerative agriculture techniques, and precision livestock farming are gaining traction as farmers seek to minimize their environmental impact. 

The rise of Product-as-a-Service (PaaS) 

In this era of rapid technological change, access to cutting-edge equipment and technologies is crucial for farmers to remain competitive. However, the high upfront costs of many modern agricultural technologies can be a significant barrier to entry. 

PaaS offers a compelling alternative. Instead of purchasing equipment outright, farmers can subscribe to use it on a pay-per-use or subscription basis. This model provides several key advantages: 

• Improved cash flow: By spreading costs over time, PaaS models free up valuable capital for farmers to invest in other areas of their operations, such as seed, fertilizer, or labour. 

• Access to the latest technology: PaaS enables farmers to access the latest technologies, such as autonomous vehicles and precision agriculture tools, without the burden of a large upfront investment. 

• Predictable costs: Subscription models provide predictable monthly expenses, making it easier for farmers to manage their budgets and plan for future investments. 

• Reduced maintenance burden: Many PaaS agreements include maintenance, repair, and support services, eliminating the need for farmers to invest in costly maintenance infrastructure and reducing downtime. 

• Data-driven insights: PaaS providers often leverage data analytics to monitor equipment usage, performance, and maintenance needs, providing valuable insights to farmers and optimizing equipment utilization. 

Benefits for manufacturers 

PaaS models also offer significant benefits for agricultural equipment manufacturers: 

• Predictable revenue streams: Recurring subscription revenue provides a more stable and predictable income stream compared to traditional one-time sales. 

• Increased customer engagement: PaaS models foster closer relationships between manufacturers and farmers, enabling them to provide ongoing support, gather customer feedback, and identify new product development opportunities. 

• Enhanced customer loyalty: By providing comprehensive service packages, manufacturers can build stronger customer loyalty and foster long-term relationships. 

• Improved resource utilization: By optimizing equipment utilization and extending the lifespan of assets, PaaS models can contribute to a more sustainable and circular economy. 

The future of agriculture 

The PaaS model holds immense promise for agriculture. By lowering barriers to advanced technologies, it empowers farmers to meet the growing global demand for food in a sustainable way. Additionally, the model aligns with broader efforts to create circular economies by extending equipment lifespans and maximizing material use. 

As the agricultural sector evolves, embracing models like PaaS could be the key to unlocking long-term growth, sustainability, and resilience for farmers and manufacturers alike. It’s a win-win approach that not only supports rapid technological advancements but also drives a future-ready farming landscape. 

The circular economy is no longer just a concept; it has reached “megatrend status,” according to The Circular Economy Foundation. Over the past five years, discussions and reports about the circular economy have nearly tripled, reflecting its growing significance. Companies are recognizing the potential of this economic model to align with their ESG (environmental, social, and governance) goals, optimize operations, and drive sustainability and profitability. 

One innovative way organizations are embracing circularity is through product-as-a-service (PaaS) finance models. These models offer a streamlined, sustainable approach to managing assets, minimizing waste, and maximizing resource efficiency. Here’s a closer look at how PaaS works and how it can help achieve your ESG goals. 

What is Product-as-a-Service? 

In PaaS models, customers pay for the outcomes or services a product delivers rather than owning the product outright. Instead of making a large upfront purchase, businesses pay a subscription fee, while the provider retains ownership of the product throughout its lifecycle. 

These contracts, often structured as operating leases, typically include value-added services such as procurement, maintenance, and end-of-life management. When the lease ends, the asset is returned to the provider, where it can be repaired, refurbished, or recycled, reducing waste and preserving valuable resources. 

Now, let’s explore three ways PaaS models support ESG objectives. 

1. Accelerate your investment in green technology 

Transitioning to greener operations is a cornerstone of ESG strategies, but high upfront costs can be a barrier to adopting sustainable technologies like electric fleets, renewable energy systems, or battery storage. PaaS financing eliminates this hurdle by spreading costs over manageable monthly payments, enabling faster adoption of green tech. 

PaaS contracts often come with additional services, such as training and maintenance, helping organizations improve operational efficiency and lower resource strain. For manufacturers, this approach also enhances customer relationships. 

Collaboration between manufacturers and financial institutions further strengthens these contracts, enabling manufacturers to scale PaaS offerings without impacting their balance sheets. PaaS is also a great way to gather customer insights and enhance marketing strategies. This win-win approach benefits businesses and boosts industry-wide sustainability efforts. 

2. Leverage data insights to optimize sustainability 

PaaS models often incorporate advanced asset management tools that provide real-time insights into product usage, location, and health. These data-driven systems empower businesses to maximize efficiency, reduce waste, and minimize emissions. 

Take the agriculture industry, for example. Farmers use precision sensors and software embedded in PaaS contracts to automate operations, optimize resource use, and reduce the environmental impact of chemicals and fuel. Similarly, other industries benefit from better asset utilization, which enhances productivity while driving sustainability. 

By integrating these data-driven tools, organizations can make smarter decisions about asset deployment, renewal, and disposal, directly supporting their ESG objectives. 

3. Ensure sustainable end-of-life management 

One of the standout benefits of PaaS models is the built-in circular management of assets. Since ownership remains with the provider, manufacturers are incentivized to extend product lifecycles through repair, refurbishment and recycling. 

This approach not only reduces environmental impact but also shifts the responsibility of sustainable disposal away from businesses. Many PaaS providers include services like reverse logistics, data sanitization, and compliance with local recycling regulations in their contracts, making it easier for organizations to meet their ESG goals without additional burdens. 

A circular future 

Meeting ESG expectations from investors, regulators, and customers is now a top priority for organizations worldwide. The circular economy provides a practical roadmap to grow sustainably, and PaaS models are a powerful way to integrate circularity into your business operations. 

By embracing PaaS, organizations can eliminate the complexities of traditional asset ownership, access cutting-edge green technologies, and create long-term value for all stakeholders. At BNP Paribas Leasing Solutions, we are committed to helping our partners and clients advance their sustainable transition, promoting circular economy principles, and driving innovation through PaaS business models. 

Let’s work together to build a more efficient, sustainable future. 

PaaS can accelerate the transition to a Circular Economy by extending the lifespan of assets and maximising resource utilisation.

BNP Paribas Leasing Solutions, has published an in-depth research report spanning industries including IT, green technology, agriculture, healthcare, transportation, and construction, unveiling the transformative potential of Product as a Service (PaaS) in enabling the Circular Economy. The report titled, “The Circular Opportunity – Harnessing the Power of Product-as-a-Service”, presents a clear case for PaaS as a practical, scalable business model for driving sustainable change. 

The report not only demonstrates the environmental benefits of PaaS but also highlights its economic value. Business can decouple growth from resource consumption while addressing challenges such as supply chain disruptions, price volatility, and resource dependence.  

The Circular Economy Imperative

 The Circular Economy prioritises designing products to remain in circulation for as long as possible, extracting maximum value and use from all raw materials, products and waste. Despite this vision, only 7.2% of the global economy is currently circular, and the share of secondary materials we consume has dropped 21% since 2018.[1]

The study emphasises PaaS as a key driver in accelerating this shift. Under this model, customers pay for the use or value of a product rather than owning it outright, while ownership remains with the provider. Since the provider’s revenue depends on efficient product use, they are incentivised to minimise waste, reduce resource consumption, and extend the product’s lifecycle. This model has the potential to transform industries like agriculture, construction, green technology, and IT by promoting asset longevity and resource optimisation. 

Unlocking Opportunities Across Industries 

The report illustrates the important role of cross-sector collaboration between financial institutions, manufacturers, dealers and specialist service providers to realise the benefits of PaaS in enabling the Circular Economy. By highlighting implementation challenges and fostering collaboration, the report reveals how stakeholders can unlock the full potential of sustainable business models that drive both economic growth and environmental conservation. 

Backed by case studies of successful PaaS in action and exclusive industry insights, the report discusses implementation pathways for businesses. This includes navigating regulations, adopting legally binding risk-sharing agreements and leveraging AI for asset residual value assessments. 

Anne Pointet, Head of Company Engagement at BNP Paribas: 

“This report provides actionable insights on how PaaS can enhance usage resource efficiency, extend product lifecycles, and offer cost-effective solutions for businesses to reduce their carbon footprint. By moving from ownership of products to a service-based model, PaaS is transformative for manufacturers and can enable them to embed sustainability into their operations and strategies.” 

Neil Pein, CEO of BNP Paribas Leasing Solutions, comments: 

“The Circular Economy offers a transformative alternative to the traditional linear model by maximising asset value and minimising waste. Sustainable finance and innovative models like Product-as-a-Service (PaaS) enable circularity, unlocking new revenue streams for manufacturers, fostering stronger customer relationships, and supporting investments in innovation and sustainability.”  

The report The Circular Opportunity Harnessing the Power of Product-as-a-Service can be read in full here.

ENDS 

This report has been commissioned by BNP Paribas and BNP Paribas Leasing Solutions. The research was conducted by Do Well Do Good, a purpose-led strategy consultancy. The report aims to contribute to advancing Product-as-a-Service (PaaS) business models, in line with the European Union’s efforts to promote the transition towards a circular economy.  

The report offers an overview of the role of the PaaS in the circular economy ecosystem. It also explores two key sectors in depth, examining how agricultural equipment and green tech have responded to opportunities and challenges presented by PaaS models. Additional insights have also been gathered across four other sectors – heavy vehicles, healthcare, IT, and construction. Interviews were conducted with 28 industry experts across six industries.  

About BNP Paribas Leasing Solutions 

Press Contacts : 

BNP Paribas Leasing Solutions : Suhale VORAJEE – suhale.vorajee@bnpparibas.com  Aspectus Agency : Arthur INSTONE – bnpparibas@aspectus.com

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[1] Circular Economy Foundation, The Circularity Gap Report, 2024, https://www. circularity-gap.world/2024 (Accessed: 2024) 

• New 3,500 square metre IT refurbishment and remarketing center in the Yvelines department will support businesses to maximise the lifespan of their IT devices through refurbishment, promoting a circular economy.
• Operated by BNP Paribas 3 Step IT, the centre aims to handle equipment from both the Bank’s clients and BNP Paribas entities in continental Europe.

BNP Paribas has opened a new IT refurbishment and remarketing centre in the Yvelines department (78), reinforcing its commitment to addressing the growing challenge of electronic waste in Europe. This investment aligns with BNP Paribas’ commitment to advancing the circular economy by extending the lifecycle of IT equipment such as laptops, desktops, mobile phones and tablets.

This centre is operated by BNP Paribas 3 Step IT, a joint venture launched in 2019 between the professional equipment financing subsidiary of BNP Paribas, BNP Paribas Leasing Solutions, and the Finnish company 3stepIT, a Nordic leader in circular technology services.

BNP Paribas 3 Step IT aims to gradually increase the processing capacity of the centre, which could reach up to 400 000 reprocessed IT equipment per year, with a first target of 100 000 equipment by the end of 2025.

With this new centre, BNP Paribas 3 Step IT allows the Bank to provide more efficient and sustainable IT lifecycle management services to its clients across Europe, as well as to its own entities. The centre will also operate a ‘buyback’ service (also known as IT Asset Disposition or ITAD) where businesses can send their decommissioned IT equipment knowing it will be either refurbished or responsibly recycled, with data securely and fully erased.

Carmen Ene, CEO of BNP Paribas 3 Step IT states:

The investment in this centre underscores BNP Paribas’ commitment to advancing the circular economy in Europe, aligning with the European Union’s ambitious goals to promote circularity and sustainable resource use. This also marks a significant milestone for BNP Paribas 3 Step IT, reinforcing our mission to help clients maximise the value of their technology while reducing electronic waste.

Neil Pein, CEO of BNP Paribas Leasing Solutions adds:

This is a major step for BNP Paribas, strengthening its commitment to supporting clients in their transition to a more resource-efficient and low-carbon use of their IT assets. This centre also upholds a responsible employment policy, which values and supports people with disabilities, those in social reintegration, and older adults.

About BNP Paribas

BNP Paribas is the European Union’s leading bank and key player in international banking. It operates in 63 countries and has nearly 183,000 employees, including more than 145,000 in Europe. The Group has key positions in its three main fields of activity: Commercial, Personal Banking & Services for the Group’s commercial & personal banking and several specialised businesses including BNP Paribas Personal Finance and Arval; Investment & Protection Services for savings, investment and protection solutions; and Corporate & Institutional Banking, focused on corporate and institutional clients. Based on its strong diversified and integrated model, the Group helps all its clients (individuals, community associations, entrepreneurs, SMEs, corporates and institutional clients) to realise their projects through solutions spanning financing, investment, savings and protection insurance. In Europe, BNP Paribas has four domestic markets: Belgium, France, Italy and Luxembourg. The Group is rolling out its integrated commercial & personal banking model across several Mediterranean countries, Turkey, and Eastern Europe. As a key player in international banking, the Group has leading platforms and business lines in Europe, a strong presence in the Americas as well as a solid and fast-growing business in Asia-Pacific. BNP Paribas has implemented a Corporate Social Responsibility approach in all its activities, enabling it to contribute to the construction of a sustainable future, while ensuring the Group’s performance and stability.

About BNP Paribas Leasing Solutions

BNP Paribas Leasing Solutions offers capital-efficient business equipment financing solutions in key sectors including agriculture, construction, transportation, materials handling, ICT, healthcare, and green tech. Drawing on its 70-year history, its partners and clients rely on its market expertise, asset know-how, and advisory services to propel their growth, transformation, and transition to a low-carbon circular economy. Present in 18 countries across Europe and Turkiye, and employing over 3000 experts, BNP Paribas Leasing Solutions offers vendor finance solutions in the USA and Canada in partnership with Bank of Montreal, and in China through Jiangsu Financial Leasing. In 2024, BNP Paribas Leasing Solutions advanced €16.3 billion in asset finance and presently manages a €40.4 billion leased asset portfolio. BNP Paribas Leasing Solutions is fully owned by BNP Paribas and is positioned within the Group’s Commercial, Personal Banking & Services division. For more information, visit leasingsolutions.bnpparibas.com

About BNP Paribas 3 Step IT

BNP Paribas 3stepIT is a leading provider of circular technology services, helping businesses transition to a more sustainable model for all their technology needs. As a joint venture between BNP Paribas Leasing Solutions and 3stepIT, BNP Paribas 3 Step IT offers end-to-end services that enable businesses to procure, manage, and refurbish their digital assets securely and efficiently while contributing to a more sustainable and responsible tech consumption model. With a presence in seven European markets and four Nordic countries thanks to 3stepIT, BNP Paribas 3 Step IT partners with a wide range of businesses and organisations to drive digital transformation while embedding sustainability at the core of IT operations. To learn more, visit 3stepit.bnpparibas

The European Union’s ambitious goal of becoming the first climate-neutral continent by 2050 has spurred industries to transform their product offerings, leading to the development of numerous green technologies, from electric vehicles to battery-powered solar storage systems. As a significant contributor to greenhouse gas (GHG) emissions, the manufacturing sector plays a pivotal role in driving the transition to a low-carbon future. 

In this challenging environment, product-as-a-service (PaaS) models can empower manufacturers to strengthen their businesses, diversify their revenue streams, and deliver more sustainable outcomes for both their customers and the planet. 

A rich and diverse service offering 

The energy transition is driving significant business transformation, with organizations across industries adopting smart, green tech solutions on a large scale. From wind and solar power systems to energy-efficient heat pumps and electric vehicle charging infrastructure, businesses increasingly require sustainable solutions to future-proof their operations. 

PaaS models enable manufacturers to shift from single-product sales to a service-based approach. This encompasses multiple customer touchpoints throughout the asset’s lifecycle, including deployment, maintenance, and product renewal. 

A prime example of this approach is Schiphol Airport’s partnership with Signify (formerly Philips Lighting) to implement a circular lighting solution. This comprehensive lighting-as-a-service contract includes design, installation, maintenance, replacements, and sustainable end-of-life handling. The connected lighting system allows for immediate identification and repair of failures, enhancing efficiency and improving the customer experience. 

By adopting PaaS models, manufacturers gain numerous opportunities to engage with customers throughout the contract period, fostering trust and loyalty. Instead of shouldering the upfront investment, customers pay for the service they use or the agreed-upon outcomes. This creates a more dynamic and continuous sales cycle, reducing reliance on one-time product sales. 

Fulfilling producer responsibility 

The EU has implemented several regulations establishing Extended Producer Responsibility (EPR) frameworks, requiring producers to manage the entire lifecycle of their products, including end-of-life disposal. 

PaaS models are valuable tools for fulfilling EPR requirements. They allow manufacturers to retain ownership and track their assets. When an asset reaches the end of its useful life, it is returned to the manufacturer, enabling them to close the loop on materials and contribute to a circular economy. By retaining ownership and accountability, manufacturers are better positioned to meet their sustainability commitments. 

In a world increasingly focused on sustainability and circularity, PaaS models not only make sound business sense but also help pave the way for a greener, more resilient future. 

In a world grappling with resource scarcity and environmental challenges, the circular economy emerges as a groundbreaking approach to economic development. As the European Union sets its sights on becoming carbon neutral by 2050, the circular economy is a a transformative model that promises both environmental stewardship and economic opportunity. 

What is the Circular Economy? 

Traditional economic models follow a linear path: take resources, make products, use them, and discard them. The circular economy flips this script entirely. It’s an innovative approach designed to maximize the value of resources, minimize waste, and create a regenerative economic system. The core principle is simple yet powerful: keep resources in use for as long as possible, extracting maximum value while minimizing environmental impact. 

The statistics are stark. Currently, global resource consumption exceeds the Earth’s regenerative capacity by 1.7 times annually. Shockingly, about 90 percent of worldwide resources end up as waste. But the circular economy offers a compelling alternative, with analysts predicting it could unlock $4.5 trillion in economic growth by 2030. 

Enter Product-as-a-Service (PaaS) 

One of the most exciting innovations driving the circular economy is the Product-as-a-Service (PaaS) model. Instead of traditional ownership, customers pay for the service and outcomes a product provides. This approach fundamentally reimagines how we think about assets and consumption. 

In a PaaS model, responsibility for the asset remains with the provider, and customers pay periodic fees to use the product. This approach comes with significant benefits: 

• Reduced waste through extended product lifecycles 

• Incentives for manufacturers to create more durable, repairable products 

• Better asset tracking and management 

• Improved data collection for optimization 

How businesses can benefit 

Two primary financial solutions are emerging to embed circularity: 

1. Operating Leases: Provides access to assets with additional services, without the option to purchase 
2. Subscription-Based Services: Flexible contracts with recurring fees for product access 

These models introduce innovative billing approaches like pay-per-use and pay-per-outcome, creating more flexible and sustainable business relationships. 

The broader impact 

The circular economy isn’t just an environmental strategy – it’s a comprehensive business transformation. By simplifying product acquisition, maintenance and disposal, companies can: 

• Optimize operational and financial performance 

• Minimize waste 

• Make more informed decisions about asset management

Looking ahead 

As ESG reporting and environmental consciousness grows, businesses that embrace circular economy principles will gain a significant competitive advantage. The transition requires reimagining product design, business models, and customer relationships. 

The European Union’s ambitious carbon-neutral goal by 2050 is driving this change, but the opportunity is global. Companies across sectors – from construction and agriculture to IT and healthcare – can leverage product-as-a-service models to meet new environmental expectations while unlocking economic value. 

The circular economy represents more than a trend. It’s a fundamental shift in how we understand resources, consumption, and economic growth. For forward-thinking businesses, it’s not just about reducing environmental impact – it’s about creating more resilient, efficient, and innovative business models. 

Are you ready to close the loop? 

The transition to a circular economy is no longer a distant aspiration; it’s a pressing reality. The EU’s ambitious target of a fully circular economy by 2050 demands a fundamental shift in how we design, produce, distribute, and consume goods. This necessitates a systemic overhaul, requiring the development of new technologies, processes, and innovative business models. 

One of the most promising tools in this journey is Product-as-a-Service (PaaS). This innovative business model offers a pathway for organizations to adopt and embed circularity into their operations effectively. At BNP Paribas Leasing Solutions, we explore this opportunity in depth in our latest report, Harnessing the Power of Product-as-a-Service, which examines the role PaaS can play in transitioning from a linear to a circular economy. 

What is PaaS?

PaaS reimagines how goods and services are delivered and consumed. Traditionally, consumers or businesses purchase ownership of a product outright. Once it reaches the end of its lifecycle, it is often discarded – characteristic of the linear, single-use economy. 

In contrast, PaaS shifts the focus from ownership to access. Instead of purchasing the asset, users pay for the value or benefits the product provides. The manufacturer or financier retains ownership throughout the product’s lifecycle, offering value-added services – such as maintenance, upgrades, and eventual recycling – on a subscription-style basis. 

Is PaaS relevant to your sector? 

The potential of PaaS extends across a wide range of industries, offering unique advantages for both businesses and the environment: 

• Agriculture: Farmers can access high-value equipment like tractors and harvesters through flexible subscription models, reducing upfront costs and improving cash flow. Manufacturers benefit from predictable revenue streams and the opportunity to optimize equipment utilization through data analytics. 

• Green Tech: PaaS simplifies the adoption of sustainable technologies like electric vehicles (EVs) by bundling vehicle purchase, charging infrastructure, and maintenance services into a single, predictable subscription. This reduces upfront costs for consumers and accelerates the transition to cleaner transportation. 

• Transportation: Truck-as-a-Service models, where operators pay per kilometre travelled, optimize vehicle utilization, reduce fuel consumption, and improve driver safety through advanced telematics and predictive maintenance. 

• Healthcare: PaaS models for medical equipment, such as MRI machines, ensure optimal utilization and reduce the burden of upfront capital investment for healthcare providers. Manufacturers can optimize equipment maintenance and extend the lifespan of assets through data-driven insights. 

• Information Technology: Device-as-a-Service models provide businesses with access to the latest technology while minimizing the risks associated with hardware obsolescence. Manufacturers can recapture value through device refurbishment and remarketing, extending the product lifecycle and reducing electronic waste. 

• Construction: PaaS models for heavy equipment allow construction companies to access the latest technology without significant capital outlay. Manufacturers can optimize equipment utilization, improve maintenance efficiency, and recapture valuable materials at the end of the equipment’s lifecycle. 

Key PaaS challenges 

While the potential of PaaS is significant, several challenges must be addressed to facilitate widespread adoption: 

• Developing robust data infrastructure: Collecting, analyzing, and sharing data across the value chain is crucial for optimizing PaaS models and measuring their environmental impact. 

• Building trust and transparency: Establishing clear contracts, ensuring data privacy, and fostering open communication between providers and consumers are essential for building trust and long-term relationships. 

• Addressing regulatory and legal frameworks: Adapting existing regulations and developing new frameworks to support circular business models and facilitate the transition to PaaS. 

• Investing in skills and training: Developing the necessary skills and expertise within the workforce to design, implement, and manage circular business models. 

Product-as-a-Service represents a powerful tool for driving the transition to a circular economy. By shifting the focus from product ownership to value delivery, PaaS models can unlock significant economic and environmental benefits. As businesses and policymakers embrace this innovative approach, we can move closer to a future where economic growth is decoupled from environmental degradation, creating a more sustainable and equitable future for all.