How Financing Options Work for Retailers and Consumers
Among the fastest growing trends for retailers today is consumer financing. As lending platforms become more innovative, more opportunities are opened to consumers. Financing options, therefore, are important to everyone from retailers to consumers.
When consumers have financing options, they feel a sense of empowerment, so much so that around two-thirds of financed consumers will return to your business at least one additional time purchasing $500 worth of merchandise or more. Almost 30 percent will do this three to five times.
Security is an issue when considering financing options as it has become more common for breaches to occur. Fortunately, there is payment technology available that keeps consumer data more secure. The application process that utilizes this technology also provides a faster, smoother transaction.
Financing options offer clear advantages to you as a retailer, while giving consumers what they want. With the right financing program, you will see a larger percentage of applicants approved for credit, which means their loyalty to your brand increases, as do their purchase amounts. However, not all financing options are created equal.
The multi-lender solutions are among the best financing options out there today. Instead of relying on a primary lender, which often excludes everyone except the prime consumers, retailers are finding a more customer-friendly option to be the multi-lender solution.
It’s estimated that nearly half of all consumers who apply for primary credit aren’t getting approved with the traditional in-store application process. When they apply online for primary credit, only 25 percent are finding success, according to a report about retail consumer financing trends from Vyze. The unfortunate side effect is that these consumers experience a negative feeling and that reflects poorly on your brand.
The fear of being denied credit is what leads to an estimated 28 percent of consumers from even attempting to gain financing. For those that are declined, they often ditch their cart, or they’ll downsize it significantly.
When you go with a multi-lender process, the near-prime consumers are approved at a much larger rate. Customers who don’t have perfect credit histories can still have financing options when you partner with a financier that will work with near-prime consumers.
At The HELPcard, we know your customers aren’t all prime-level consumers, but they deserve financing options, too. In fact, we specialize in offering financing to consumer with A, B and C credit. Our clients tell us about how their business has grown due to this wider availability to more consumers. We’re confident that our solutions will improve cash flow for you just as they have for our current clients. Contact us today and let’s discuss how it works.